Cargo Insurance & Liability
How marine cargo insurance works, what carrier liability actually covers, and how to choose the right level of protection for your shipment.
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Handling a Cargo Claim Against Your Forwarding Business
A cargo claim lands on your desk and the clock starts on three separate deadlines, only one of which is the customer claim against you. Here is what a forwarder should do first, which notice periods genuinely bar a claim, what the current liability limits are, and how forwarders lose the right to pass a claim up the chain.
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Marine Cargo Insurance Documents: Certificate, Policy, Open Cover
Which insurance document you hold decides whether a bank will pay you. UCP 600 rejects a cover note outright, and that surprises people at the worst moment.
How Much Cargo Insurance to Buy: CIF Plus 10 Explained
CIF plus 10 percent is the default sum insured on almost every shipment. It comes from one line in Incoterms, and for some cargo it is materially too low.
What Cargo Insurance Does Not Cover
The exclusions apply to all risks cover just as much as to the narrow clause sets. These are the ones that decline real claims on genuinely damaged cargo.
General Average: Why Another Shipper's Fire Can Cost You
Your cargo is undamaged, the ship is safe, and you still owe money. General average is the oldest rule in shipping and the one that surprises shippers most.
Carrier Liability Limits: What You Actually Get Paid
Carriers are liable, but only up to a limit set per kilo or per package. On most cargo that limit pays out a fraction of what the goods were worth.
Institute Cargo Clauses A, B and C: What Each One Covers
A and C are not the same product at different prices. One covers all risks minus exclusions, the other covers a short list of named perils and nothing else.
What Your Forwarder's Trading Conditions Actually Say
The standard terms behind every booking: liability caps, time bars, lien clauses and the agent-versus-principal distinction that decides who you can sue.
How to File a Cargo Claim: The Step-by-Step Process
Notice deadlines, the documents you need, what carrier liability actually pays, and the three mistakes that kill a claim before it starts.
Cargo Insurance Explained: Why Carrier Liability Is Never Enough
Carrier liability is capped by weight, not value, so it pays a fraction of most losses. Cargo insurance covers the gap, and it is cheaper than shippers expect.
Cargo Insurance FAQ
Does the carrier's liability cover the value of my goods?
Almost never in full. Carrier and forwarder liability is capped by international conventions and trading conditions, and is calculated by weight rather than by cargo value, so for anything valuable the recoverable amount is a small fraction of the loss. Separate marine cargo insurance covers actual value, which is why it exists as a distinct product.
What is the difference between Institute Cargo Clauses A, B and C?
Clauses (A) is all-risks cover, subject to stated exclusions. Clauses (B) and (C) are named-perils covers that pay only for losses from specific listed events, with (C) the most restricted of the three. The practical consequence is that a shipment insured to (C) may be uninsured for the loss that actually occurs, such as water damage from a leaking container.
How much should I insure my cargo for?
The market convention is 110 percent of the commercial invoice value plus freight. The extra 10 percent covers the incidental costs of a loss: survey fees, disposal, and the buyer's lost margin. Insuring only the invoice value leaves you short, and over-insuring does not pay out more, because marine policies indemnify actual loss rather than the sum insured.
Does CIF mean my cargo is properly insured?
Only to a minimum standard. Under CIF the seller must insure, but Incoterms 2020 sets the floor at the restricted Institute Cargo Clauses (C). CIP, by contrast, requires all-risks Clauses (A). If you are buying CIF and want broader protection, negotiate it expressly in the contract or arrange your own top-up policy.
What can invalidate a cargo insurance claim?
The most common causes are insufficient packing, delay as the sole cause of loss, inherent vice in the goods themselves, and signing a clean proof of delivery for cargo that was visibly damaged. Inadequate securing inside a container is frequently treated as insufficient packing rather than an insured peril, so bracing and dunnage matter to your claim as much as to your cargo.
What should I do immediately if cargo arrives damaged?
Note the damage on the delivery receipt before signing, photograph the cargo and packaging in place, keep everything including the packing materials, and notify the carrier and insurer in writing straight away. Most carrier contracts impose very short windows for notifying visible damage (often three days or less), and a clean signed receipt makes any later claim substantially harder.