CARGO INSURANCE

The Risks of Transit
The probability of sustaining a loss on goods in transit is greater than you may think. On average, a ship sinks every day. Long voyages, extensive moving and shifting of cargo, THEFT, and bad weather all add substantially to the potential for loss or damage.

Many shippers are misled into relying on the carrier to pay for losses in transit. That can be a major mistake. Law or tariff restrictions limit the liability of most carriers (see chart below). Also, most carriers are not responsible for losses which are unforeseeable and beyond their control.

The Roanoke Trade Approach to Cargo Insurance
There is a genuine need for Cargo Insurance, and few insurance agents are able to fill that need effectively. At Roanoke Trade, it's our primary business.

Concerned that a standard cargo policy may not always cover your total financial exposure, Roanoke Trade  compiled a list of actual claims which have resulted in severe losses. We then wrote special coverage, backed by some of the world’s most secure insurance companies, to reduce the exposure of those risks.

Examples of claims covered by our special clauses:

• A liquid container carrying ammonia spilled its cargo when a valve failed. Ordinarily, debris removal coverage would have been limited to a percentage of the shipment’s value. Our endorsement increased that limit to equal the policy’s catastrophe limit.
• A manufacturer’s shipment was lost in a fire while in storage at the port of discharge. The shipment had been held at the port for 30 days. Typically, coverage would have ceased 15 days after discharge from the vessel. Our endorsement extended the terms beyond 30 days.
• Ordinarily, cargo is valued at the cost of the merchandise plus 10%. An importer lost a shipment of machinery from Europe plus significant income from the intended sale of the machinery. Our “selling price” clause covered the profit which would have been earned had the machinery been sold.

A Roanoke  Trade cargo policy can be customized to contain some of the broadest wording available. We will work with you to design a policy, which meets your unique transportation needs. Among the many options we offer are:

• Ocean and airfreight coverage
• Inland truck or rail coverage
• Comprehensive "all risk", warehouse-to-warehouse coverage (including high risk countries)
• Product deterioration and/or refrigeration breakdown protection
• Product recall or rejection
• Highly technical or sensitive equipment
• Export credit and political risk protection
• Contingency coverage
• Perishable items
• Container insurance
• Multinational processing, distribution and/or warehousing (including bonded warehousing)
• Project relocation
• War risks protection
• Strikes, riots and civil commotion

The Open Cargo Policy for Transportation Specialists
Freight forwarders and customs brokers increasingly market their services as “transportation logistics experts.” Providing a comprehensive cargo insurance program is as much a part of the service package as is providing freight or duty rates. You have to do it to keep your competitive edge!

The Open Cargo Policy written on behalf of the customs broker or freight forwarder must offer shippers coverage for numerous kinds of freight without going through an application and approval process.

Roanoke Trade has designed a policy with this need in mind. Insurance can be provided for shipments made by ocean, air, rail and truck, and can cover a variety of perils using an “all risk” policy including the hazards of war. We can include special endorsements to insure freight which is not covered by a typical cargo policy.

Examples include:

• Freight at points of consolidation such as an NVOCC facility.
• Freight sold on FOB/FAS/CFR terms - some marine policies will not attach until the cargo is loaded on the vessel.
• Debris removal - cleanup costs associated with a cargo loss.

It is important to have a flexible rate schedule that gives you competitive rates for a broad variety of cargo, origins and destinations. For the occasional circumstance when your open cargo policy will not apply, rely on our expertise to arrange an amendment to your policy or obtain coverage through an alternative insurer. Some of these “special risk” situations may be:

• Transit and/or storage moving through the interior of Russia. Most cargo policies exclude coverage for this portion of a transit.
• High-risk cargo such as computer chips, laptop computers, fine arts, jewelry, antiques, etc.
• Political risk coverage for expropriation, nationalization, or confiscation.