Accidents happen, and natural events may impact goods while in transit. Freight claims are the method used to recover some of the loss. Understanding the difference between freight insurance and freight liability insurance is paramount to choose the coverage that is right for your clients’ business needs.
Freight insurance also called cargo insurance, does not require proof that the carrier was responsible for damage or loss of a shipment, only that it occurred. The cost is generally based on the on the declared value of goods being shipped. This is a much more accurate way to recover loss for heavy items than carrier insurance, which places a per pound value a shipment. Claim payments can typically be received within 30 days.
Freight Liability Insurance
This type of solution can cover the full value of the goods being shipped. Once the shipper has proven that a shipment was unreasonably late or delivered damaged, the carrier may be required to establish a carrier defense. If it fails to do so, the shipper may be entitled to the recover the actual shipment amount.
Freight carriers, property brokers and warehouse operators can purchase specialty coverage from freight liability insurance to freight forwarder coverage. Policies are designed to protect them against claims of damaged or missing freight. Coverage can be purchased to cover goods that are lost in transit via air, ocean rail and truck.