Last updated on: September 13, 2021
Cargo insurance also referred to as freight insurance, is a must-have for truck drivers and trucking businesses—in fact, it’srequired by law!
The Federal Motor Carrier Safety Administration, also known as FMCSA, requires truck drivers who transport household goods and freight forwarders of household goods to carry a minimum amount of cargo insurance.
This minimum amount is known as carrier liability, and it usually doesn’t cover very much—which is why obtaining a thorough cargo insurance policy is a best practice for truckers and trucking business owners.
Why? This regulation is in place to provide essential protection in the event that the load they are hauling—their cargo—becomes damaged or destroyed due to situations that extend past the trucker’s realm of control.
Sound important? It is! With so many variables and unknowns that can occur on the road, cargo insurance is imperative.
Let’s explore what cargo insurance entails, why you need it, and how to obtain the best cargo insurance coverage for your budget and business-related needs.
What is Cargo Insurance?
Cargo insurance policies work by shielding you from costs associated with the loss, damage, or theft to goods—the cargo being carried.
- Typically, cargo insurance coverage extends to both while cargo is being stored as well as while it is in transit to the final destination—when the cargo ultimately reaches the buyer.
- Cargo protection policies can cover a wide range of transit—including water, air, road, rail, registered post parcel, courier, and more.
Types of Cargo Protection
- Cargo insurance coverage policies can be implemented for both domestic and international travel, however, it must be standardized to deal with variations in coordination between an array of different states and/or countries.
- Due to these variables, Pennsylvania’s Alchemy Insurance Agency categorizes cargo insurance and protection into the following areas:
- Land Cargo—this type of domestic coverage includes trucks and small utility vehicles in the transport of cargo via land routes (roads). Theft, damage caused by collision, and other similarly related risks are typically covered.
- Marine Cargo—Marine Cargo coverages extends to transit done by sea or air. Damage incurred during cargo loading/unloading, weather-related incidents, theft by piracy, and more. However, the key component to Marine Cargo coverage revolves around international transportation, which can be broken down into the following:
- Open Cover Cargo Policies—permanent or renewable coverage is activated in the event thatthe insurance holder opts for coverage against various perilous situations.
- Specific Cargo Policies—typically, only shipments are covered under these “voyage policies,” in which a company may initiate contact by approaching the insurance provider to cover a specific shipment.
- Contingency Insurance Policies—in this case, the customer is responsible for ensuring the cargo—not the seller, although it may also be in the seller’s best interest to safeguard themselves against damage or loss by proactively seeking coverage.
- Alchemy Insurance Agency is comprised of a team of skilled and knowledgeable cargo insurance specialists who are well-versed in the different domains of protection.
- These agents have developed working relationships with the top names in the insurance industry in order to connect you with the exact policies, coverage and protection you need.
The Importance of Cargo Insurance
Think about it—when your employees are in it for the long haul—literally—they have a great deal of responsibility on their shoulders—and in their cargo trucks.
- Ease the stress on your drivers’ minds for a more focused, capable employee and an overall improved, positive mindset.
- With the proper cargo insurance in place, you can also breathe a sigh of relief knowing that your business is in good hands, and that while you may not be able to predict or prevent all negative circumstances, you have done your part in protecting your business.
- Cargo insurance coverage can also be required or requested by shippers to ensure the safety of their goods from loss, damage, or theft while en route to their final stop. If you’re already covered, you’re good to go and get down to business!
- As with most types of commercial insurance coverage, cargo insurance is not an all-encompassing, one-stop shop.
- Policies and their limitations vary across providers. For these reasons, it is best to work with a cargo insurance specialist who has accurately assessed your needs, including the value of the cargo you’re carrying, to make sure the policy you choose keeps you properly protected.
When you’re ready to connect with the most dependable, affordable cargo insurance specialists available, reach out to the trusted team at Alchemy Insurance Agency today!
Pennsylvania’s premier independent agents at Alchemy work efficiently to compare top carrier brands for their clients, matching you with the perfect providers—and prices—to meet all of your insurance coverage needs.
Visit https://alchemyinsurance.com/ to get started right away—you won’t regret it!