Why You Need Cargo Insurance
Are you an importer or exporter? Do you ship large and regular quantities or occasionally? Protecting your cargo with insurance is crucial, as it serves as a safety anchor against any losses or damages that may occur during shipment.
At Richadelo, our cargo insurance covers loss or damage to goods during shipment, including transportation by air, sea, or land. Even with the best efforts of freight forwarders, shipping lines, airlines, and truck drivers, accidents and mishaps can still happen.
Understanding Cargo Insurance
Whether it’s due to natural disasters, pirate attacks, or unforeseen incidents, cargo insurance can help alleviate your financial burden. Just as you need health insurance despite being healthy, your goods need insurance protection during transport.
Why Choose Cargo Insurance?
You have the option to ship your cargo without insurance; however, if damage or loss occurs, you will absorb the entire financial burden. While you could proceed legally against your freight forwarder, this process is lengthy, expensive, and could face limitations in international law.
For instance, shipping carriers like DHL explain that the liability for lost or damaged cargo is based on weight or package count, which is often less than the commercial value of your goods. Additionally, “Acts of God” such as storms, flooding, or earthquakes are not reimbursed under international conventions, making insurance your best bet for recovery.
Types of Cargo Insurance
There are two main types of cargo insurance:
- Open Coverage: Ideal for companies that are consistent importers or exporters. This annual policy covers multiple shipments to and from different locations, with the option for renewal.
- Single Coverage: A one-time insurance for single shipments, suitable for small businesses or individuals without regular freight needs.
Who Pays for Cargo Insurance?
When you hire a shipping service from a freight forwarder, the cost of insurance is typically included to protect against loss or damage. Freight forwarders also purchase insurance to cover their own responsibilities, and the shipping lines or airlines also have insurance for their vessels and aircraft. In short, everyone involved in the transportation process shares responsibility for ensuring the cargo is protected.
Where Can You Get Cargo Insurance?
Most freight forwarders offer cargo insurance through trusted insurance brokers with whom they have established relationships. This is the most convenient option, as they can quickly provide coverage and expedite the claims process. Alternatively, businesses with consistent shipping volumes may choose to work directly with an insurance broker.
Cost Calculation
The cost of insurance depends on the type of goods being shipped. For high-value or easily stolen goods like electronics, the insurance rate will be higher. On the other hand, low-value items such as plastic toys will have a lower insurance rate. Insurance premiums typically start at $10 to $100, depending on the product and risk.
Claim Procedures
In the event of damage or loss, you should follow the procedures provided by your insurance provider. However, one key piece of advice is to inspect and take note of any damage upon delivery. Always take photos of the damage and contact the policy issuer immediately to begin the claims process.
Contact Richadelo Group of Companies
If you have any questions or would like to learn more about our cargo insurance services, please contact us:
OUR CONTACT IN AFRICA
SANMIC & MAYYEM NIGERIA LIMITED
+234 81-07206548
info@richadelo.com
100 Adeniji Adele Road, Lagos, Nigeria.
OUR CONTACT IN NORTH AMERICA
RICHADELO GROUP OF COMPANIES INCORPORATED
1 (888) 871-5935
1 (888) 509-2339
(705) 408-1853
info@richadelo.com
571 Bayfield Street, Suite 4, Barrie, Ontario. Canada. L4M 4Z9