In today’s interconnected economy, the movement of goods – whether across cities or international borders – is vital to many businesses. However, with increased mobility comes additional risk. In the transportation business, a lot can go wrong with trucks, trailers, and cargo both within and outside of your control. Transportation carriers are well aware that cargo theft is a major threat in North America, but goods can also get damaged or lost in transit, which your company may be held responsible for. Severe weather or an animal on the road can also cause a collision or rollover, damaging your truck and everything aboard it. There are many perils that can expose your cargo to loss, and that’s why cargo insurance is so important to protect the loads entrusted to you.
If you don’t have the right insurance, you could be stuck with the bill for damaged goods as well as cleanup. Damaged cargo can also harm your relationships with your shippers and impact your company’s reputation. For transportation businesses, as well as freight forwarders, freight brokers, or warehouse operators who also ship freight, cargo insurance can serve as a much-needed safety net in a challenging business and can help with maintaining operational continuity.
What is Cargo Insurance?
Motor truck cargo insurance provides coverage for goods while they are being loaded or unloaded from conveyances, while goods are in transit on a conveyance, as well as goods in terminals awaiting delivery. It protects against losses resulting from events such as theft, collision, spoilage, fire, or load shifts during transportation. This type of insurance is crucial for businesses that rely on the timely and safe delivery of products to their customers.
Cargo insurance is often part of a transportation package policy that may include:
- Commercial General Liability (CGL): Covers liability for bodily injury, property damage, personal and advertising injury, and products-completed operations.
- Commercial Auto Insurance: Covers your insured vehicles for bodily injury, property damage, physical damage (if applicable) and other elected coverages.
- Warehouse Operator’s Legal Liability Insurance: Covers goods stored under a warehousing receipt.
Theft of goods in transit
One major risk for carriers is cargo theft, which continues to grow in Canada and the United States. While it’s often an underreported crime, Équité Association — which maintains Canada’s only cargo theft database with information on stolen trucks, trailers, cargo and heavy equipment — reports that Canadian cargo losses increased by almost 30 per cent in 2022 compared to the previous year.
According to analytics firm CargoNet, cargo theft activity in Canada and the U.S. hit a record high in 2024, with a total of 3,625 reported incidents, up 27 per cent from 2023. The estimated average value of stolen cargo per incident rose from $187,895 in 2023 to $202,364 in 2024.
Thieves often target products that are not easily traceable and easily re-sellable. Raw and finished copper products, consumer electronics, cosmetics, and grocery items are common targets for theft.
Why Cargo Insurance matters?
While theft is a major threat to cargo, there are many other types of losses that can happen. For example, flatbed operators can find themselves in trouble if load securement is incorrect, bulk liquid haulers can experience a spill, reefer haulers are exposed to spoilage claims and LTL dry van haulers can be prone to load shifts. Outside of cargo specializations, severe weather and collisions can be a threat to your business as well. Whatever you specialize in, Northbridge Insurance’s vast experience with motor truck cargo can help you protect your load and handle your claim to keep your wheels moving.
Protect your business with Cargo Insurance
Cargo insurance can be tailored to match your specific risk exposures – and it helps build customer trust and business credibility. Whether your load is damaged in a collision, or a shipment of goods is stolen in transit, cargo insurance ensures you’re not left footing the bill. To learn more about how cargo insurance can protect your goods and keep your operations running smoothly, visit our Transportation & Logistics Services Insurance page today.
