What is Shipping Insurance? A Comprehensive Guide - GoShip

What is Shipping Insurance and Why Do You Need It?

Posted on:
Aug 09, 2023

If you have ever shipped goods, you must have heard about cases of freight loss or damage due to many unpredictable circumstances. Getting shipping insurance, whether it is freight or cargo insurance and freight liability can help you prevent logistics inconveniences. With a reliable delivery service like GoShip, the transit of items is a safe and smooth process.

What is shipping insurance?

Shipping insurance, or freight or cargo insurance, is a crucial safeguard for businesses and individuals involved in transporting goods. It provides financial protection against the loss or damage of cargo during transit. Whether you’re shipping domestically or internationally, this type of insurance ensures that your freight is covered, offering peace of mind throughout the shipping process.

Freight insurance is the additional protection that covers your cargo in case of loss or damage. Cargo insurance keeps you calm and confident during the shipping process. If something happens to your freight, the insurer will reimburse its value, so you don’t have to cover the expenses yourself. You can order freight insurance from the shipping company or third-party insurers.

Depending on your business needs, there are several types of freight shipping insurance. You can choose a suitable coverage based on its duration, possible damage, or insurance capability.

What is the difference between freight insurance and freight liability?

Shippers often assume that freight insurance and liability are the same when they’re not. Every booked shipment comes with limited liability coverage, and the word “limited” explains the main difference. The final amount of coverage is based on the commodity type and defined by the carrier’s tariffs. In most cases, it does not fully cover your shipment’s value, especially when it’s high.

Carriers can pay you a refund when the cargo is destroyed due to fault. To receive the maximum amount of carrier’s coverage liability, you have to prove your goods were packed correctly and undamaged at the pick-up. Under bad weather conditions and natural disasters, the carrier is not entirely liable for your freight.

With insurance for shipping, you are safe no matter what happens to your freight. You also won’t have to prove the incident was the carrier’s fault. If your goods are shipped via freight insurance, you don’t need to wait until your claim is processed or stress out about whether you will get a refund or not.

Freight insurance offers much more comfort for the shipper than liability coverage and lets you receive a refund faster. Typically, claims are paid within 30 days instead of several months. In the long run, getting freight insurance is a cost-effective solution. In addition, insurance agents will manage the paperwork for you.

When should I get freight insurance?

While booking a shipment and partnering with a particular carrier, figure out the maximum liability coverage for your commodities. If your freight value exceeds the stated amount, it is best to get insurance for shipping. Also, cargo insurance is essential when:

  • You ship fragile goods. If your freight refers to the class of fragile items, it is more prone to get broken.
  • The cost of a product is very high. Often, such products require special handling, and mentioning their size and weight details on insurance documents.
  • You don’t have time to wait for claim processing in the case of freight damage or loss. Claims filed in terms of freight insurance get paid within a month.

What are the essential details to take care of?

Even after getting the full-scale cargo insurance, it is necessary to remember freight delivery specifics. The better you organize the freight transportation, the lower the chances of damage are.

  • Make sure to provide proper packaging for your goods. This is the first step to avoiding any damage. Whether they are sensitive or require additional protection, ensure the safe conditions for transportation. For example, you may apply double packaging or void fillers when moving fragile items. If your units contain breakable parts, it’s better to secure them with wrapping materials or extra packing pieces.
  • Providing accurate information about your freight is a necessity. It will save you time and money in case of cargo damage. Also, you’ll be able to compare your freight characteristics when filing a claim. Precise data is significantly helpful in freight loss cases as even the tiny cargo parts are sometimes lost during shipments. Clear shipping paperwork can assist you in identifying lost items or checking cargo specifications.
  • Take pictures of your freight before the transit. It is a good recommendation that can be helpful while reviewing the reasons and consequences of freight damage/loss. Cargo pictures will help you compare the freight’s state after the shipment. They serve as the most apparent evidence of freight damage and will effectively streamline the process of filing claims.

Getting freight shipping insurance with GoShip

Purchasing freight insurance is a wise and irreplaceable option for shippers who want to play it safe. Check with your shipping provider today to see what different options they have available for insuring your shipment. GoShip cooperates with one of the most reliable cargo insurance providers, Falvey Insurance Group. Falvey will ensure your freight shipments’ safety and assist you with the required paperwork. And GoShip, in turn, will help you find a perfect carrier match and get a free full truckload or LTL quote in a few clicks.

GoShip’s intuitive platform simplifies freight shipping, blending advanced technology with expert knowledge. For businesses looking to navigate the intricacies of freight shipping with confidence, GoShip offers a reliable and efficient solution.

Ready to experience hassle-free shipping with accurate full truckload and LTL freight quotes? Visit GoShip.com today and take the first step towards streamlined, cost-effective freight logistics.