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Insuring Your Goods

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As you prepare your items for shipping, consider these facts:

In 2014, Canada Post processed 9.1 billion mail pieces and packages
In 2014, 1.1 million tonnes of cargo were loaded and unloaded at Canadian airports
In 2011, 466.1 metric tonnes of total cargo was handled at Canadian ports

Add the millions more metric tonnes transported by truck and rail service each year, and it’s easy to see (and hard to imagine!) the massive volume of goods shipped within Canada and to international destinations. While the vast majority of those items and containers were received in good condition, accidents and unforeseen circumstances do occasionally result in the damage of goods in transit. As you plan your shipment with your shipping company, it’s important to keep in mind the risks that are present and the opportunities you have to mitigate them.

What Does Damage Really Mean to You?

Damaged goods are always inconvenient, and in the worst cases may not be reparable or recoverable. If goods are being shipped with the intent for commercial sale, certainly they cannot be sold if lost or received in a damaged state. Therefore, it is important to ask yourself what it means to you or your business if something should happen. What is your tolerance for risk? Can you absorb the financial losses required to replace personal goods or remanufacture commercial goods?

Damages are never a positive experience, but depending on what you are shipping, the consequences can vary greatly from negligible to serious. So, if you are risk averse, or want to ensure that you recover the value of the items you ship, cargo insurance is a practical – and recommended – option for you.

Why Insurance Matters

Many people consider insurance an add-on item that provides shippers with more income without significant value to the customer. Nothing could be further from the truth. Would you be surprised to hear that your $10,000 collectible artwork weighing 20 lbs. may be compensated only $40.00 if it were to be damaged in transit between two Canadian cities?

The reason for this is, by law, transportation carrier liability limits are very low, calculated solely by weight, and very likely will not cover the value of goods and the costs incurred by the shipping process. For certain types of carriers shipping within Canada, $2,00 per pound is actually the legal and standard limit of liability. Ocean and air freight have different rates, but are also protected by limited carrier liability developed over time and through a variety of laws, regulations and treaties.

That’s why World Cargo always recommends full coverage, point-to-point cargo insurance when shipping by air, ocean, or over the road.

There are many different types of policies to cover general shipments and specific types of items. However, you’ll find that something often referred to as an all-risk cargo insurance policy is the broadest form of shipping insurance available. It is the most comprehensive policy you will find, covering physical loss or damage for virtually any reason. If there are any exclusions that are specifically not covered by the terms of the all-risk cargo policy, such as improper packing, spoilage, or abandonment, for instance, they will be spelled out in the terms and conditions.

How complete is the coverage? Imagine the worst situation that your cargo could face. All-risk likely covers it. The policy protects you from catastrophic loss including, but not limited to, fire, storms, washing overboard, and theft. It is simply the best coverage for recouping the full replacement costs of goods shipped.

What Is Full Replacement Cost?

Insurers may value your shipment using their own stated formulas and calculations, but most shipping companies will recommend that a shipment to be insured for its full CIF value. “CIF” is a formula that reflects both the value of items and the recovery of shipping expenses and intangibles. A CIF formula used to calculate the value of a shipment might look something like this:

Cost of Goods + Insurance + Freight + 10%

Keep in mind that some insurers may require that personal goods must be packed by a commercial company as a condition of maintaining coverage.

Reduce Your Stress and Minimize Your Worry

Shipping is often a necessary part of travel or commerce, but it’s hard to have your valuables out of sight and out of your control. Not only will full coverage insurance provide you with greater peace of mind, but World Cargo will be there to help you to select the right policy for your shipping requirements and guide you through the process of valuing your items. So, when you are ready, call us toll-free at 877-232-0204 or use our online quote form to start estimating and shipping your goods. We’ll make sure your items are properly processed, safely packed, adequately insured, and quickly on the way to their new destination.


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The best way to get help is by talking to an expert. With years of experience under our belt, World Cargo is well-equipped to tackle any challenge and find solutions that fit your needs. Our dedicated team is here to guide you through the complexities of logistics. Contact us today, we can help you understand shipping.