Cargo insurance coverage is crucial for smooth international trading businesses.
All Canadian transport companies are legally bound to have a minimum liability coverage to cover potential financial losses. However, the basic coverage plan does not provide comprehensive coverage against cargo theft.
As per CargoNet® records, around $44 million worth of shipments were stolen in the second quarter of 2023 in the United States and Canada. The average shipment cost per theft was around $100,000 to $260,703.
With so much at stake, a reliable cargo insurance coverage in Canada provides a safety net for goods trading businesses. A personalized plan can cover all the costs lost in events of theft, natural disaster and more.
Let’s dive in to understand what is Cargo Insurance and what protection plan is perfect for your trading business:
What is Cargo Insurance Coverage?
Cargo insurance in Canada is a more comprehensive solution for shippers, consignee or freight forwarder than the average carrier liability coverage. Your basic liability plan only covers minor damage or delays, but does not back you up for incidents of theft, accidents, or natural disasters. Even if you have theft coverage, the limit is capped to a point that the value of your lost goods is not covered.
With the growing theft incidents, as indicated by statistics above, getting cargo insurance is a smarter move.
A complete shipping insurance plan protects your goods from the pick up to destination location. You can have your coverage customized to fully cover the costs of your goods. This leaves you with utter peace of mind while your goods are in the transit phase–undoubtedly the most haunting and stressful time for a trading business owner.
What’s the Importance of Cargo Insurance Coverage?
Cargo insurance in Canada is your back up plan to cover the colossal financial loss in business in events of theft or natural disasters. If your business handles large-scale shipment of expensive goods across the seas, a huge amount of revenue is at stake with every shipment. On the contrary, you cannot control or foresee the events of natural disaster, accident or theft targeting your shipment. The constant stress of millions at stake can even upset your mental health and peace. So, it’s best to seek a reliable cargo insurance plan to take your control back on your peace of mind and the revenue tied to each shipment. Get a Quote for personalized Cargo Insurance Coverage in BC, Canada now.
Types of Cargo Insurance Coverage
In BC, Canada, the freight insurance coverage is categorized into two types:
Named-perils cargo insurance:
As the name suggests, named-perils insurance covers you for the risks specified in the policy. This plan is best for businesses dealing with low-value goods or have limited risks on the route.
All-risk cargo insurance:
Under this coverage, you get protection from all types of bigger or smaller risks except if some are specifically excluded. This is a preferable choice of businesses as the risk of financial loss is minimized to near zero.
What is Covered Under Cargo Insurance in Canada?
Freight or cargo insurance in BC, Canada is suitable for businesses who frequently transport or ship their goods within Canada or across borders. There are different cargo insurance coverage options, such as:
Land Cargo Insurance:
This provides coverage for transport by land via car, truck or other transportation vehicles. It can either be domestic or international transport.
Marine Cargo Insurance:
This provides coverage for transporting goods via container ships or freight vessels. It is suitable for international companies operating in different countries.
Air Transport Cargo Insurance:
The coverage plan protects shipments sent by air. It is best for time-sensitive parcels that need to be delivered on an urgent basis.
Warehouse Storage Insurance:
Your goods aren’t safe when kept in a warehouse facility overseas. Insurance covers you for the revenue lost due to theft, fire or natural disaster, if it happens.
FAQ
What risks are covered in cargo insurance?
Cargo insurance companies protect you in events of damage caused due to fire, explosion, sinking or stranding, etc. It covers the additional expenses you have to pay for due to collision, overturning or other obstacles on the way. Insurance also provides backup in cases of floods, tsunamis, earthquakes or natural disasters.
Why is it important to insure cargo?
Cargo insurance coverage provides coverage for the revenue loss you have to bear, if the unforeseen happens. It covers a percentage cost of the total value of goods lost or damaged when in transit. Without the insurance, cargo is stored, shipped and delivered at the expense of the owner, consignee or shipper.
Does cargo insurance cover freight?
Yes, it provides coverage for freight and the value is calculated based on total weight of freight instead of value of goods in transit. Freight insurance is a coverage solution for freight forwarders, who are legally responsible for transport of goods. Whereas, cargo insurance provides protection to the sender of goods, such as retailer, wholesaler, or manufacturer.
