Cargo Insurance: Why Every Shipment Deserves Cover
Carrier liability is limited and rarely covers the full value of your goods. How cargo insurance works, what it covers and how Incoterms decide who should buy it.
Many shippers assume that if goods are lost or damaged, the carrier will pay. In reality, carrier liability is limited by international conventions and contract terms, and compensation is often far below the value of the cargo. Cargo insurance closes that gap.
What cargo insurance covers
Policies vary, but cover can include loss or damage during transport, handling and storage — for example from accidents, theft, water damage, fire or general average at sea. “All risks” cover is the broadest; named-perils cover is narrower and cheaper.
Who should insure?
The Incoterm in your contract decides who carries the risk at each stage. Under CIF and CIP the seller must arrange insurance; under most other terms the party carrying the risk should consider buying it.
How much to insure
A common practice is to insure the invoice value plus freight and a margin for additional costs. Check that the sum insured reflects the real cost of replacing the goods.
If something goes wrong
- Note damage on the delivery receipt or CMR before signing.
- Take photos and keep damaged packaging.
- Inform the insurer and the carrier in writing as soon as possible.
- Keep invoices, packing lists and transport documents for the claim.
Small cost, big protection
The premium is usually a small percentage of the cargo value — a modest price compared with the cost of an uninsured loss.
Viking Group can insure your freight from any port and under any International Commerce Terms. Ask our team at logistics@vikinggroup.az.