Cargo insurance is more complex than you might at first think. Without a degree in admiralty law, you can easily get lost trying to understand the finer points. But if you want your shipment to arrive safely, and to be covered for the loss in the case that it doesn't, it is imperative that you get cargo insurance. So how should you proceed? First, you'll need to gather the information that is pertinent to the insurer. This includes:
- What is the cargo?
- What is the value of the cargo?
- How will the cargo be packed?
- Departure location
- Arrival location
Now you're ready to get a few quotes. You can get quotes from a freight forwarder, an insurance broker, or an insurance company directly. Many insurance companies now give quotes online. When comparing policies, pay close attention to the following areas to ensure that you're getting the level of coverage you expect:
- Exclusions from coverage: You may be breathing a big sigh of relief at how inexpensive your "all risk" policy is, without realizing that an "all risk" policy is almost always qualified by a clause that reads "except as otherwise provided." You'll want to know what the exclusions to coverage are--they are usually listed in the "endorsements" section. So be sure to inquire about the exclusions, which might include everything from damage resulting from a worker' strike to radioactive contamination.
- Door to door: Be sure that the entire trip is covered from departure door to arrival door. Some policies will insure you only until delivery at port. What happens if your cargo is stolen from the pier? Also keep in mind that some countries do not offer inland coverage.
Don't forget that cargo insurance companies are businesses trying to make money, like everyone else! So be sure to read your policy closely. If the standard policy does not offer the coverage you want, you can always ask (and pay for) special endorsements to provide the extra insurance (and assurance!) you deserve.