You have cargo insurance and understand its importance. You’ve evaluated the risks of carrying products. The goods your drivers transport in the trailer may even exceed the value of the truck itself. And in some cases, the cargo you carry isn’t that high-priced. In these cases, you could be carrying cargo insurance with limits you’d never reach.
That’s why it’s important to take a look at that policy. Determine what your true risks are. You definitely don’t want to file a claim only to discover it exceeds your limits. But as a business, you don’t want to pay year after year for more coverage than you need.
Here’s how to determine what kind of cargo coverage you should really have.
Type of Cargo Transported
The first thing to ask is, what kind of cargo are you transporting? Are you taking bread or produce to the local grocery store? That’s one of the lowest priced shipments you can carry. Are you hauling new, expensive sports cars? Your coverage needs just went up significantly.
History doesn’t always determine the future. But it does give you something to work with. What kind of losses has the company experienced in the past? Did you find your insurance adequate? Did you end up paying out of pocket?
Risks You Want Coverage For
You can get relatively “cheap” cargo coverage. It feels like you’re covered until you actually file a claim. Then you find out almost everything that is actually likely to happen is excluded.
When considering how much you really need, look at the following risks and whether you need to insure them. Then make sure they’re in the policy.
- Water damage – If the trailer leaks or is flooded, you’re covered.
- Loading/Unloading – That one’s self-explanatory.
- Reefer breakdown – This covers spoilage when a refrigerated truck malfunctions.
- Pollution liability – If you’re hauling gas, oil, liquor or other substances that could potentially pollute and harm wildlife, you may need coverage for a clean-up. Even if the DOT offers to help, you’ll get hit with a clean-up bill.
- Debris removal – Do you have flatbeds that might lose a load that wasn’t properly secured? Debris removal is important. Any truck that gets flipped or hit hard enough can lose its load. Cleaning that up can be more costly than the load itself. (There are lots of risks that are specific to flatbed trucks.)
- Theft/Hijacking – It’s a sad truth. Despite all of your security measures, cargo can be stolen or a vehicle can be hijacked.
- Sue and labor coverage – This covers costs beyond the cost of cleaning up and reimbursing the client for lost goods, like court judgments, legal fees, lost work, etc.
- Earned freight coverage – This covers your lost income. You’ve already invested time and money to deliver and won’t be paid. There’s insurance for that.
- Infidelity/Dishonesty – If you hire a driver who turns out to be a crook, stealing some or all of the cargo, this part of the policy covers that.
Get the Best Price for the Coverage You Need
Take a look at your risks and pull that policy out to see what you’re covered for. Does your cargo coverage match your current business needs? Are you paying for more coverage than you need?
Save time and save money on truck insurance when you let us do the insurance shopping for you. Fill out this simple form to start getting quotes for all your commercial truck insurance needs. We’d be happy to talk to you about your cargo insurance needs.