| There are five (5) insurance options for shippers to | | | | "What is the deductible?" "What are the exclusions |
| insure their cargo shipments. | | | | and conditions of the coverage?" "At what point |
| Deciding which option is the right one for a shipper is | | | | does the insurance coverage cease to cover your |
| an important decision which should be carefully | | | | cargo?" Do not let the supplier make YOUR business |
| thought out and reviewed on a regular basis. How | | | | insurance decisions. Do not relinquish control! |
| you secure insurance for your cargo can make a | | | | (4) Occasional shippers can purchase a Shipment |
| significant difference in the cost of the protection | | | | Certificate. Although this is a more expensive way to |
| and the terms of the coverage that you receive. | | | | buy coverage, it may be to be the most economical |
| Here is a brief discussion of those options with the | | | | and efficient method for the small shipper. |
| key points of comparison: | | | | (5) BUY YOUR OWN "OPEN CARGO" INSURANCE |
| (1) Insurance can be obtained through a freight | | | | POLICY! |
| forwarder or customs house broker. Most of these | | | | The cost of cargo insurance is small in comparison to |
| companies have an in-house ocean cargo policy that | | | | the total cost of packing, handling, and shipping |
| is made available to their customers. This is a | | | | goods. Bypassing the middleman (freight forwarder, |
| significant profit center for these companies due to | | | | customs house broker, overseas supplier) can yield a |
| the high mark-up charged to the shipper. These "all | | | | huge savings in the cost of your shipping. You will be |
| purpose rates" can be much higher than the rates for | | | | the insured. You will know what you are getting. You |
| your specific shipment. Despite these issues, this is | | | | will have the right coverage to meet your specific |
| the preferred option for the small shipper with four | | | | needs. Your interests will be protected, not the |
| or five shipments per year. Due to the minimum | | | | middleman's interests. If you should have a claim, you |
| premium required for an "Open Cargo" Policy, this | | | | are the insured and the insurance company who |
| may be a more economical way to purchase | | | | issued the policy has a vested interest in handling the |
| coverage. But if a shipper does enough volume, the | | | | claim promptly and fairly. Your shipments will be |
| savings could be up to 50% of what he is currently | | | | automatically protected with no chance of failing to |
| paying. | | | | insure a shipment. You will have a single point of |
| (2) Insurance could be secured through the carrier | | | | contact for all of your cargo issues rather than |
| shipping the cargo. Unfortunately, this makes the | | | | having to deal with multiple coverages with different |
| carrier the named insured, not the shipper. This | | | | terms of coverage from different sources. You will |
| protects the carrier not the shipper. If there is a loss, | | | | be free of "GENERAL AVERAGE" claims. And if you |
| the shipper will need to file a liability claim against the | | | | don't know what that means, you need to |
| carrier and their insurance company. And the | | | | understand this point before you have a major |
| insurance company will seek to protect the interests | | | | surprise. |
| of their client, the carrier, not the shipper. | | | | You know that you need cargo insurance or you will |
| (3) Overseas suppliers might provide the coverage | | | | recover very little for damaged goods. The question |
| for YOUR cargo. This arrangement raises a number | | | | is, "Where are you going to get it?" The answer is at |
| of significant questions. "Will the coverage be placed | | | | M. Silver and Associates, Inc. |
| with a U. S. company, or will you have to collect on a | | | | If you have a question about cargo insurance or your |
| claim in a foreign company?" "What perils are covered | | | | need for cargo insurance, contact our cargo |
| by the policy (All-Risk vs. Named)?" "What language is | | | | department by e-mail at To receive a cargo |
| the certificate written in?" "Will you be paid in dollars | | | | insurance quote, please download our Open Cargo |
| or some other currency?" "Is the cost of the | | | | Insurance Questionnaire. |
| insurance passed on to you and if so, at what cost?" | | | | |