Carrier liability and cargo insurance are different concepts. Liability may be limited by contract and rules, and insurance protects the financial interest under selected conditions.
When is this especially important?
Valuable equipment, electronics, temperature-sensitive and fragile goods, multimodal and long-term container transportation require separate assessment.
How is the cost determined?
Commercial invoice, freight and agreed costs may be taken into account. The exact basis depends on the insurer and the conditions. Undervaluation may affect your payout.
Coverage conditions
Events, exclusions, deductibles, start and end points, packaging and notice periods need to be checked. War risks, strikes and temperature may require separate conditions.
First actions in case of an event
- Note damage upon receipt;
- take photos and videos;
- notify the carrier and insurer;
- save the cargo and packaging;
- prepare an invoice, packing list and transport document.
Exact request
Indicate the product, cost, route, transport, packaging, risks and date. INprice request Please note separately the need for insurance.
What to check before insuring international cargo?
Verify in writing the insurance item, route, modes of transport, coverage start and end points, deductible, packaging requirements and exclusions. Selection of Incoterms® 2020 helps understand the transfer of risk under a sales contract, but does not itself determine insurance coverage.
Indicate commercial value, freight, packaging and special risks in request for logistics rate. Final coverage is confirmed only by the policy and terms and conditions of the insurer.
Main types of cargo insurance: ICC A, B and C
International cargo is most often insured under the Institute Cargo Clauses of the London insurance market. ICC (A) works on an “all risks” basis and excludes only the risks expressly listed; ICC (B) and ICC (C) are narrower named-perils covers (fire, sinking, dropping during transhipment and so on). High-value, fragile and electronic goods are usually placed under ICC (A), low-value bulk goods under ICC (C). War and strikes risks are added by separate clauses.
Why carrier liability limits are not enough
Carrier liability is capped by international conventions per kilogram: 8.33 SDR per kg under the CMR Convention for road transport; 666.67 SDR per package or 2 SDR per kg (whichever is higher) under the Hague-Visby Rules at sea; about 26 SDR per kg under the Montreal Convention for air freight (after the 2024 revision). The SDR (special drawing right) is the IMF’s unit of account. For a 200 kg machine worth USD 40,000, the CMR limit covers only a fraction of the value. Only separate cargo insurance closes that gap.
Incoterms 2020 and the duty to insure
Only two Incoterms rules oblige the seller to insure: CIF (sea) at minimum ICC (C) level and CIP, which since the 2020 edition requires ICC (A) level cover. Under FOB, FCA, EXW, DAP and the other rules, insurance is the buyer’s decision. Check where risk passes with the Incoterms selector.
What determines the premium
The premium is usually a percentage of the insured value (invoice value + freight + an agreed uplift, often 10%). The rate depends on the type of goods and damage risk, packaging, route and transit countries, transport mode and number of transhipments, the chosen cover (A, B or C), the deductible and shipment frequency. Regular shippers use an open (annual) policy; one-off shipments use a single-voyage policy.
Frequently asked questions
Is cargo insurance mandatory?
It is not required by law, but a letter of credit, the sales contract or CIF/CIP terms may require it.
How long do I have to claim?
Visible damage must be recorded at receipt; concealed damage must be notified in writing within the short period stated in the policy (usually a few days). Missing the deadline can lead to a declined claim.
Who arranges the cover?
The policy is issued by an insurer or broker; the logistics coordinator supplies value, route and risk data and aligns the process, as described on the logistics services page.
