Manufacturers: does your insurance cover your goods in transit?

Most manufacturers ship their goods at some stage in the process.

That might be shipping in expensive parts for the manufacturing process, or shipping out finished goods to wholesalers or retailers.

If things go wrong, though, do you know if your company or courier is properly covered with goods in transit insurance?

Frozen food might spoil because of improper refrigeration. Items may get damaged or lost in the process or be delivered to the wrong destination.

Don’t just assume your general insurance will cover you for losses like these.

What is goods in transit insurance?

This covers your goods for loss or damage when in transit in one of your own lorries or when they’re being shipped by a courier.

It can be arranged with a limit per package, per container or vehicle, or per consignment.

What should you look out for?

Ensure your cover is for all risks.

That means it is covered for theft while in transit, its loss while in transit, and damage caused by transit or caused by an accident when in transit.

Talk to your broker about the best options for your business.

Do you need to arrange this for your own fleet – or have you employed a haulier?

In that instance, it’s worth looking at whether your haulier could be covered by the the UK Road Haulage Association conditions of carriage.

Members of the RHA who use the conditions correctly can find their liability limited for the goods being carried, but those who do not might face the full costs of the load and financial loss from a late or missed delivery.

If their liability is limited, your insurance needs to cover any potential shortfall so your company doesn’t bear the brunt of the loss.

The more information you can provide your broker in this situation, the more accurate the cover they can arrange.

Don’t assume your courier’s insurance will cover your goods

If you’re using a courier, you must look at their goods in transit insurance.

Is it adequate to cover your goods and is it all risks coverage?

Couriers often don’t know exactly what they’re shipping until they pick it up.

That means their general insurance may not cover every aspect of your job.

Some insurance companies also won’t pay out 100% for ‘target goods’ which are lost or damaged in transit.

These are items such as computer parts, computers, tablets, and electronic equipment.

Some companies will only pay out 50% of the value on these goods.

That could be a costly mistake for your business.

You must check whether your courier’s company has this policy and give your courier as much information about your goods as possible well in advance of pick up.

If you’re a manufacturer in Cardiff or South Wales looking to arrange goods in transit insurance, call our friendly and experienced team on 02920 470375. Or, you can contact us here: https://severnbay.com/contact/.