Ensuring that you are covered in case of damage or loss is crucial when transporting your goods, but finding the right freight insurance policy can be a frustrating, time-consuming process. Fortunately, if you take the right precautions before your cargo hits the road, you can plan ahead and ship without hassle.

To set you on the right track, we’re laying out helpful tips so you can make an informed decision.



Before we dive into the particulars of cargo insurance, there is an important distinction to be made between carrier liability and cargo insurance.

Carrier liability is the coverage provided by the carrier that pertains to delay, damage, or loss, however, damage is frequently outside of the carrier’s jurisdiction. Cargo insurance provides additional coverage beyond the limited coverage of carrier liability.



Cargo insurance works as a stand-alone insurance policy, providing coverage for the full value of your shipment without the need to prove liability for loss or damage. The Carmack Amendment mandates that carriers have a legal and financial responsibility to customers when cargo is damaged during transport. Though, this is only limited to a certain amount.

There is a type of insurance to protect you for most occasions, so you should carefully match your policy with your shipping needs. Carrier liability by itself does not cover all possible risks.

Limited liability covers a percentage based on the total weight of the cargo if shippers prove some form of negligence occurred. Then, there is built-in coverage.

Built-in coverage appears to be a safe option when planning shipments, but extensive damage can occur during transport that a carrier will not be liable for: force majeure (extraordinary weather events, riots, shipper & packer errors). This also includes instances where proof of delivery (POD) or bill of lading (BOL) received an unauthorized signature.



Shipments can secure a wide range of cargo insurance coverages, including:

All risk insurance covers instances that result in unexpected property damage. However, “all risk” does not necessarily entail every risk. This coverage is certainly broad, but it is important for you to understand its boundaries to ensure it is right for you.

Open coverage covers all shipments (regardless of value) and does not have a set expiration date.

Annual coverage remains on file for a full year and requires the disclosure of company info, including shipments as well as annual turnover.

Single shipment functions exactly how it sounds by applying to only a single shipment. This is the quickest coverage to issue and follows a shipment from its starting location to its destination.

Named perils covers the damage that results from perils, which are defined in advance.

Total loss covers shipments in the case of a catastrophic event or total loss, but it does not cover partial loss. Total loss covers the cost of the shipping bill, freight charges, and other expenses associated with the shipping.


To find the best insurance for your transportation needs, make sure to seek out the advice of an expert. Contact a Journey Freight agent today and receive a prompt response outlining the next steps to take for safeguarding your goods.

Share this:

Like this: