Professional drivers face the unexpected all the time. And, now that spring has arrived in full-force, the potential for dangerous storms to introduce an added layer of risk is undeniable. Already, semi-trucks are toppling in Tornado Alley—and wind gusts are overturning eighteen-wheelers in Indiana and Illinois.
In the face of lost and damaged cargo, brokers, freight forwarders, and shippers breathe a thankful sigh of relief knowing that at least their losses are covered.
Except, they discover—too often and too late—that they’re not as protected as they thought they were.
What’s really covered by your motor carrier’s cargo liability policy?
A carrier’s policy typically covers acts of negligence committed by either the driver or the motor carrier—negligence you must be able to prove.
In the event of a severe storm, however, that cargo liability policy will likely rule any weather-related damage as an act of God—damage that won’t be covered.
In this business, we know you have to move fast to secure loads. So, it’s understandable that, in the rush to get freight moving, you might acknowledge that your carrier has $100,000 in cargo coverage and believe you’re protected.
It’s simply not the case.
COVID pressures exasperate your risk
Supply chain disruption is increasing the intensity of hurry-up-and-wait scenarios for many brokers, shippers, and carriers. And, the collective sense that moving essential freight is more important than ever is very, very real.
These pressures can often translate to brokers and shippers moving at a rapid-fire pace to select carriers—and perhaps not doing their ordinary due diligence and understanding their carrier’s policy exclusions. It might even mean understanding those exclusions and choosing to take the risk anyway.
Now, consider the following:
- Drivers, like all frontline workers, are working longer hours and dealing with the fear that not only might they become infected, but that they might bring COVID home to their families—anxiety that makes them more likely to make a mistake
- Highways are far more empty than typical—and drivers may knowingly or unknowingly push the hammer down
- Semi-trucks traveling at higher speeds are more vulnerable to high winds
It’s a recipe for greater risk.
Prevention is the best insurance policy
As grandma always said, an ounce of prevention is worth a pound of cure.
So, while we recommend all-risk cargo insurance as an excellent way to mitigate risk, limiting your exposure to dangers on the road is always the best way to go.
Are you in a position to select the route for your load?
If you can avoid a run through Tornado Alley by taking a more southerly or northerly route, by all means, do so. Also be aware that some routing software incorporates weather risk into its calculus, limiting your potential exposure to tornadoes and other severe weather events on long-haul routes.
Of course, Mother Nature is a cruel mistress. She’ll surprise us all from time-to-time, even when carriers have data-driven routing software at their fingertips. That’s where cargo insurance comes into play.
The big picture value of shipper’s interest cargo insurance
An all-risk shipper’s interest policy delivers you far greater protection than your carrier’s liability insurance policy. Covering 110% of the value of your cargo, it ensures you’re not only made whole on the cargo-side but that the administrative costs associated with submitting your cargo loss claim are covered, as well.
As an additional benefit, your per-load coverage gives you far more flexibility when it comes to carrier selection. Before, you might have felt compelled to choose carriers whose terms you didn’t like, simply because they had the best insurance. Now, as you’re confronted by increasing pressures to move freight quickly while also protecting your margins in the face of an uncertain economy, you can broaden that pool of carriers because you’ve secured your own coverage.
In short, shipper’s interest cargo insurance helps you weather the literal and figurative storm.