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Insuring the Complicated World of Today’s Warehousing Business

  By Rick Bridges (VP, Client Development) and Grant E. Goldsmith (VP, National Accounts)   Warehousing risk is complicated with multiple stakeholders involved in the supply chain with varying levels of responsibility for the cargo. To effectively put together solutions to finance risks, warehouse providers require an insurance broker who understands not only their business but also the complexity of modern warehousing. It takes a broker who comes with the expertise, creativity, and insurer relationships to move beyond what has been traditionally done and can think outside the box. Roanoke’s  Rick Bridges, VP, Client Development, and Grant E. Goldsmith, VP, National Accounts, provide critical insights into what it takes to assess and manage warehouse risk today. Inside the Warehouse Insurance Market The warehouse insurance market today is considerably smaller in large part due to corrective action by the industry to improve underwriting profitability. “Lloyd’s of London last year mandated that its Syndicates stop writing unprofitable business,” explained Bridges. “COVID-19 further exacerbated the market’s restrictions. You now have underwriters limiting their quotes to low-risk accounts and reserving capacity for risks supported by a great deal of underwriting data. This has caused a decrease in the supply of warehouse insurers. Our strength is in having relationships with carriers ready to write the coverage and being creative in building a program. In some instances, particularly for a large warehouse, it may mean working with three to four insurance companies or Syndicates to come together on a risk.” “The middle warehouse market in particular is feeling the squeeze, as it comes with risk but without much premium behind it,” added Goldsmith. “We’re seeing growth in the small to medium segment due to the growth in final-mile delivery services with no insurance market willing to serve it effectively, again reinforcing the need to work with insurance professionals who have strong carrier relationships committed to the space.” Insurance Scalability Is Key In procuring warehouse insurance, a customer needs a partner who has the ability to scale coverage based on need. “Just as a warehouse has to scale its operation to address fluctuating values throughout the year, so does the policy in place,” explained Goldsmith. “Typically, there are seasonal periods where an operation has high values at risk and other times when the warehouse may be at half capacity. In lieu of purchasing coverage with the highest…
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Criminals Exploit COVID-19 Pandemic with PPE Theft, Counterfeit Products

Beefing Up Mitigation Measures Essential for Supply Chain Security The coronavirus has upended our lives and businesses with stay-at-home orders, shutdowns, and limited crews to handle ongoing operations with remote work as the new normal. Amid this changing environment, criminals are taking full advantage of the disruption and high demand for personal protective equipment (PPE). Everything from medical-grade N95 masks to surgical gloves, gowns, test kits, and ventilators along with consumer goods such as hand sanitizers, toilet paper, disinfectants, and cleaning solutions are prime targets for counterfeit products and theft. For example, in April, 15,000 coronavirus diagnostic tests and more than two million personal protective items — including goggles, gloves, hand sanitizer and facemasks — were stolen from a cargo terminal at São Paulo’s Guarulhos International Airport in Brazil. “Organized crime groups are involved in PPE thefts around the world, including here in the U.S. at ports in New York, Chicago, and Los Angeles,” explains Cyndee Garbrecht, VP, Claims Administration, Roanoke Insurance Group. “You’re seeing counterfeit N95 masks being delivered as well as shipments disappearing. PPE is high-commodity cargo and in high demand, fitting right into a criminal’s wheelhouse.” Cyndee sits on the board of the Midwest Cargo Security Council, a not-for-profit 501(c)3 organization dedicated to combating cargo theft. The Council is comprised of individuals from the National Insurance Crime Bureau (NICB), FBI, law enforcement and the insurance industry who most recently are examining and assessing the cargo theft and counterfeit trends being perpetrated in the wake of the pandemic. “We’ve seen theft of cleaning solutions on the rise in Mexico, while tens of millions of unusable counterfeit masks from China arrived in Chicago and Los Angeles back in April and May. In addition to selling counterfeit products, shipments are being stolen once they arrive at a port or while en-route to their destination. The stolen cargo is either sold on the black market or re-shipped to China to be sold to another customer. “We’ve had one freight forwarder request a pick-up upon the arrival of a shipment at the warehouse only to be told the cargo was not ready and to call again,” says Cyndee. “When the freight forwarder followed up, he was told the shipment was missing. In some cases, there is video footage that shows the cargo sitting on the dock and then mysteriously disappearing.” Sometimes the cargo…
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Visit Roanoke’s Slack Channel at G-TEC’s Virtual Conference August 2020

G-TEC’s 2020 Virtual Conference We are pleased to be a sponsor of this year’s G-TEC 2020 virtual conference! Although we can’t meet face-to-face as we did last conference, doesn’t mean we can not interact with one another. This year we’ve set up a Slack Channel! You can find us at #sponsor-roanoke-insurance-group and while visiting, you can secure educational content everyday! Since we are social distancing, be sure to leave a message on our channel comprised of your favorite emojis. You will automatically be entered into our drawing for a $50 gift card!  

CBP Alert: Important Reminder to Pay Deferred Duties

Last week, CBP issued CSMS #43324033 – REMINDER: COVID-19 – Due Dates for Estimated Duties, Taxes and Fees Postponed for 90 Days. This reminder is for those importers who opted to defer payment of estimated duties, taxes and fees for eligible entries of merchandise entered or withdrawn from warehouses in March and April 2020. The details of the notice include: • For importers paying on a Periodic Monthly Statement, the due date for March entries is July 22, 2020 and for April entries is August 21, 2020. It is important to know the amounts owed for subsequent months is on the normal statement due dates. • For single pay or Daily Statements, payment is due 90 days from the original due dates. Additionally, estimated internal revenue taxes subject to the deferred excise tax program are payable three months from the original payment due date (July 29, 2020 and August 14, 2020). • No interest will accrue for the deferred estimated duties, taxes, and fees during this 90-day postponement period. Payments made after the new due date may be subject to interest. In addition, no penalty, liquidated damages, or other sanction will be imposed for the delayed payment of estimated duties, taxes, and fees in accordance with this temporary postponement, if payment is made by the new due dates. CBP recommends importers/filers work with their financial institutions to ensure they are aware of both the regularly scheduled and postponed deposits of estimated duties, taxes and fees that are owed in the coming weeks. This will avoid ACH defaults and subsequent debit voucher claims. We encourage you to read the full message for all relevant details including instructions on how to make payment. We also want to stress the importance of adhering to previous CBP instructions from CSMS 42421561 which emphasized that importers and CHBs should NOT prevent pending payment authorizations from occurring. To help the trade stay up-to-date on all changes related to COVID-19 U.S. Customs has provided the CBP COVID-19 Updates and Announcements webpage. You may also visit Roanoke’s COVID-19 Response page for additional information and best practices regarding insurance, surety, and ATA Carnet products in this evolving environment.

Warehouse Crisis and the Future of Storage

Ever have to suddenly store 9 containers of PPEs? Or 20 containers of athletic shoes? Unfortunately, questions like this are now commonplace due to the supply-chain disruptions caused by the global pandemic. These questions, in addition to an assessment of current industry trends and innovative on-demand warehousing solutions were discussed on the recent webinar presented by the Airforwarders Association. Below are some of the key takeaways from the dynamic discussion. Prior to the Coronavirus crisis, on-demand warehousing was growing due to consumer demands for same-day and next-day shipping close to the source. And as we’ve seen in many sectors, the crisis has accelerated the pace of change. When the crisis hit early this year, supply chains were up-ended if not completely shut down. In many cases this has left freight forwarders searching for storage solutions for their shippers. According to Brandon Fried, AfA Executive Director, “we’re facing a plethora of concerns nowadays… especially as it relates to risk management…” On the webinar, Ken Kellaway, CEO E*Fill America and RoadOne Intermodal Logistics shared his perspective on current trends. Kellaway stated that, “the big dip in rates in transportation sector, should come back soon. Demand will accelerate as we open up the economy.” Also, he sees capacity tightening up on the truck side as well as the warehousing side, as the extensive inventory is starting to burn off again and big box stores are starting to reorder. He sees very strong rates on the air freight side of things since the planes have been grounded, but with the opening, more will shift back to ocean.  With further market corrections expected, this means continued uncertainty where unexpected warehousing of goods may still be needed.   Warehouse Insurance Policies & Risk Management in the Face of Supply Chain Disruptions Shippers and forwarders should plan for a future of supply-chain disruptions, thereby driving the need for warehousing and storage solutions. They should also consider the need for additional warehouse coverage for the items that now require storage. “There are many considerations to keep in mind for freight forwarders from a risk management perspective”, states Rick Bridges, VP of Roanoke Trade. “Forwarders need to know not only if the warehouses are insured, but what about the terms and conditions of warehouse insurance policies? How are they limiting their liability?” “And this really is not unlike transit,…
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TIA Virtual Lunch and Learn With Roanoke Panelist Glenn Patton on April 28th

Last updated on May 20th, 2020Join the TIA along with industry peers and participate in 20+ interactive webinars semi-weekly from April-June on Tuesdays and Thursdays from 12pm-1pm ET. On Tuesday, April 28, 2020, Roanoke’s Glenn Patton along with a panel of experts, will discuss your insurance coverage during the COVID-19 pandemic. Learn more about how best to protect your operations against claims from allegations of negligent hiring, vicarious liability, high-risk cargo, and other issues to consider before moving freight. Hear arguments to be made to shippers on why they should consider moving all their shipments through freight brokerage operations to avoid financial exposures. *This webinar is about risk management and is not intended to provide legal advice, for which those attending should consult their legal counsel.

Best Practices for Freight Forwarders: Mitigate Losses Due to COVID-19

Last updated on May 20th, 2020 Global shipping has been one of the biggest casualties in the wake of the coronavirus (COVID-19) pandemic with challenges getting cargo to and from the docks. The Port of Los Angeles, which handles more containers in a year than any other port in the Western Hemisphere, expects in the first three months of the year to experience the biggest decline in volume since the financial crisis of 2008, according to a recent article in the New York Times. The Port of Long Beach has already reported a 17.9% year-over-year drop in imports in February. According to the Maryland Port Administration, the Port of Baltimore’s sole container terminal was closed on March 12 and will close again March 17 in response to the decline in cargo volumes triggered by the coronavirus. As freight forwarders navigate the choppy waters of an increasingly fluid crisis resulting in air travel bans, port closures, cargo delays, and city lockdowns, we would like to address some of the issues regarding contractual liability and insurance coverage while at the same time stress the importance of implementing measures and best practices to help mitigate and minimize losses. Contractual Liability “Force majeure” in contractual agreements is the legal term to describe a situation or event in which the affected party has no control over the outcome. This includes Acts of God, war, riots, and terrorism. Most freight forwarders in their Master Service Agreements and Conditions of Carriage include a force majeure clause. Force majeure, when invoked and formally declared by a freight forwarder, protects an operation from having any responsibility for an event outside of its control. It’s important to reaffirm with your clients the force majeure clause that exists under the terms and conditions of the contract so that there aren’t any assumptions made in the event their cargo is delayed or stranded as a result of actions taken by a government during the coronavirus pandemic. Errors & Omissions Liability Shippers rely on freight forwarders to provide professional advice along with the ability to move cargo from point A to B. While it’s always important to underscore that delivery dates cannot be guaranteed under normal circumstances, it’s critical you make it even more clear that despite your best efforts to deliver products on time, failures may occur particularly during a time when…
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Incoterms® 2020 Webinar – What’s New for This Decade?

Last updated on May 20th, 2020The long-awaited changes to Incoterms® by the International Chamber of Commerce (ICC) are complete and published as Incoterms® 2020. Overall, the changes are regarded by the trade as positive, however, there are notable changes that should be carefully studied. In this webinar our speakers will address the following: • Refresher of Incoterms® history, purpose and use. • Review of most common Incoterms®. • Discussion of changes under Incoterms® 2020. • Practical observations and recommendations for sellers and buyers. Make plans today to join us on Wednesday, March 18th at 12pm CT for this informative event presented by Rick Bridges, Vice President – Client Development, Roanoke Trade and Gulde Alparslan & Christoph M. Wahner, Attorneys at Law, Countryman & McDaniel. This webinar has been approved by the NEI for 1 CCS/CES/MES credit.

Why Freight Forwarders Love ATA CARNETS

Last updated on March 5th, 2020 Karen Groff, president of Roanoke Insurance Group, was featured on the FREIGHTWAYS “What the Truck?!?” show at AirCargo 2020 in Nashville. Alongside Dooner and Chad, Karen shared everything a Freight Forwarder needs to know about ATA Carnets.   The trio kicked off their rollicking conversation with the basics on what the sometimes misunderstood ATA Carnets really are and why they are an important tool for Freight Forwarders.  Simply put, an ATA Carnet is an international customs document that functions like a passport for your goods. The ATA Carnet allows you to take merchandise into participating foreign countries without paying duties or taxes. You can even transit through multiple foreign countries or return to the U.S. and leave again on multiple trips on one ATA Carnet just as long as when the carnet expires, all the goods have made their final foreign exportation and are on their way back home.  Karen and the guys used an upcoming show in Canada as an example of how easy it is to apply for an ATA Carnet and how it works. Not only practical information, but we also learn some fascinating insights into the actual history of ATA Carnets.  Roanoke has been involved in ATA Carnets since 1978. The company was appointed by the US Council for International Business (the International Chamber of Commerce) to help spread the word about ATA Carnets due to Roanoke’s deep involvement in the transportation industry.  Please visit or for more information. 

Roanoke Trade’s Patrice Lafayette Appointed to FTA Board of Directors

Last updated on May 20th, 2020Roanoke Trade is proud to announce that Patrice Lafayette has been appointed to the Board of Directors of the Foreign Trade Association (FTA). Patrice is the Director of Sales for Roanoke Trade’s Western Region and she has been an active member of the FTA for almost a decade. This appointment furthers her commitment to serving as an informative resource on international trade topics affecting both the private and public sectors. “This two-year appointment to the Board of Directors is an honor, especially at this point in my career,” she noted. “I look forward to helping FTA further their mission as a leader in educational and networking opportunities in our industry.” Connect with Patrice on LinkedIn or via email. Having celebrated their 100th anniversary, the FTA’s mission is to promote, foster, and encourage international commerce and economic growth in California and worldwide. The FTA represents more than 200 members of the international trade community. Pedro Villanueva, President of the Board of Directors of the FTA, is especially optimistic about Patrice’s appointment. “To ensure another 100 years, we need young professionals to serve in leadership roles as we move the organization forward. Attracting smart, young professionals like Patrice is paramount to our growth as we evolve and modernize.” Roanoke Trade, a division of Roanoke Insurance Group and part of Munich Re Specialty Group Ltd., operates as a specialty insurance broker focused on surety and insurance solutions for transportation intermediaries, 3PLs, customs brokers and companies with supply chains, and is a leading provider of customs bonds, marine cargo insurance and ATA Carnets for the industry.