As the cold weather draws closer, it is important to consider what would happen in the event of damage or loss to your goods in transit from rough seas, high winds and icy or wet, slippery roads, and how you could protect yourself against any resulting financial loss.
At Neptune we strongly recommend that you review the insurance cover you have in place for your shipments and consider securing a policy if you do not already have one.
We offer a marine cargo insurance policy to protect your goods whilst in transit. This covers the cost of any damaged or lost goods, along with numerous types of related costs.
We will only insure your goods under our marine cargo insurance policy when instructed to do so by you in writing.
Our dedicated team are always ready to protect your interests and are available to answer any questions you may have.
If your goods were damaged in transit, who do you turn to? Are your goods covered? Who will pay? What are your rights?
A small minority of companies believe that their goods are covered for loss and damage automatically by the forwarder or haulier. This is not the case.
Some others cite CMR as being the cover that they rely on in the event of loss or damage.
In both cases, if a loss occurs to your consignment, you are NOT insured.
This insurance is basic liability insurance laid down by the ‘ìThe Convention des Marchandises Routier ‘(CMR). This is basic cover that every haulier must have as a requirement to have an International road hauliers licence to operate.
This is a limited liability cover, so will ensure that if the driver causes an accident, or is careless or negligent, then the Insurance will cover this liability in the event of a properly formed claim. It is however often the case that:
- There is no smoking gun evidence of liability. In such circumstances the Insurance Company will NOT pay out
- You (or your forwarders) at not inconsiderable expense have to enter into prolonged correspondence with all parties concerned and try to establish fault. This is time consuming, costly and there is no guarantee of success
- Due to the adversarial approach required above, relationships between customer, forwarder and/or road haulage suppliers can be aggravated or destroyed in the process
- CMR cover is very limited in terms of the maximum pay out, so that even if a customer does get compensated they are often disappointed with the level of pay out which in some cases will be far less than the intrinsic value of the goods
- If CMR does pay out on occasion, the earliest we have seen these payments is after 4 months, delays of several years are far from uncommon
The cost of transport, as are the cost of the goods, are payable whether the goods are lost or not. CMR cover does not cover this. Almost certainly you will have to have paid your forwarders and your factories well before there is any prospect of seeing a possible pay out under CMR. This can affect cash flow, and because of the uncertain nature of the process needs to be shown in your books as a contingent liability.
Insuring your goods can protect your business by safeguarding against problems that could arise if CMR Insurance cannot be relied upon.
Marine Freight/Transport Insurance
We recommend that you look into the option of getting marine/freight transport insurance cover. There are different types and levels of cover to suit every budget and scenario. Your Sales Handler can discuss your requirements in more depth and arrange a quotation for you. The industry standard is to accept an excess, which ensures that small claims don’t get entered into and premiums are kept to a reasonable level. You can vary this up or down depending on your circumstances and budget.
You could very well be surprised at just how little it would cost for the extra level of insurance.
Here are the benefits to having your goods properly insured:
- Provided the goods have been adequately packed, there is no concern as to apportionment of blame.
- One simple form needs to be filled in. The surveyor (if required) is not acting in an adversarial way towards you. Little or no further correspondence required.
- Relationships are maintained in good humour as no one worries about the consequences if there is not pay out.
- Freight insurance can cover additional costs such as freight, import duties and taxes, incidentals and even a 15% hassle factor uplift.
- Insurance pay-outs take on average 2-3 months. Often the pay-out will coincide with the requirement to pay your factories and freight suppliers thus minimising cash flow issues.
For a minimum fee you can have the peace of mind, ease of claiming and the added knowledge that you do not have a contingent liability.
If you have any questions regarding insurance and the services we offer please feel free to contact us at [email protected]