Cargo and Logistics

Your company’s product is your most valuable asset. Marsh’s specialist cargo and logistics team can help you identify its movement and storage risks, and determine and secure the right levels of insurance protection and risk mitigation.

The cargo and logistics industry is undergoing a huge transformation. As a result of the pandemic, integration of the logistics and transportation industry has accelerated. Digitisation and customer expectations are driving existing industry stakeholders and new entrants to seek greater speed and control of end-to-end product delivery.

Our cargo and logistics team utilises the latest technology and risk management strategies to develop insurance programs that can cover the entire supply chain. Our aim is to provide you with greater risk understanding, visibility, and protection of your cargo shipments.

We continually innovate insurance programs with digital solutions, data and analytics, facilities, and risk management services. And through our integrated claims management services, we help you reduce costs and improve claims recoveries.

We serve businesses of all sizes from multinational owners of product to small parcel companies, as well as global logistics providers. We have the scale, scope, and market presence to help you manage and mitigate your risks across the supply chain.

FAQs

Although most transport companies have their own insurance for loss and liability, the coverage can be insufficient or bound by convention, limiting reimbursement for the full value of the shipment. This could lead to a situation where a company loses a considerable amount of money on lost or damaged goods without the opportunity for reimbursement from the transport company. Cargo insurance offers you indemnification against physical loss or damage of goods while they are in transit, and extends to cover goods in temporary storage during the course of transit.

Cargo insurance is a risk management tool, protecting the value of assets while in transit and/or temporary storage. It protects owners of product from potentially significant financial loss due to the destruction or non-delivery of goods. It is also required as part of certain sales contracts. Under some circumstances, sellers are obliged to provide adequate insurance, even after the goods have reached their destination. Having adequate cargo insurance is often a requirement imposed by risk financiers or banks when asked to finance the purchase of goods imported from overseas or shipped under a letter of credit.

Any party shipping goods, product, or commodities by any means of transportation.

Cargo insurance pricing is calculated based on a valuation of the goods being transported and the perceived risk. The valuation of cargo is customisable based on the desire of the cargo owner and how it calculates values. For example, the insured value of your goods can be determined by adding the commercial invoice value of the goods (how much you are receiving in payment from your customer) to the cost of freight transport, with an additional 10% charge to cover additional expenses. Alternative valuation options are replacement cost, agreed value, and selling price.

Logistics is the arrangement and/or transportation of goods in the global supply chain. The exact insurance coverage requirements must be tailored to the activities of each operation. However, as the principal activity for logistics providers is the care, custody, and control of the goods of others, a core insurance coverage is cargo legal liability.

Logistics insurance products offer protection to any party involved in the transport, storage, or arrangement of such activities. These include trucking companies, freight forwarders, warehouse operators, non-vessel owning common carriers (NVOCC), customs brokers, and freight brokers.

This can vary greatly depending on each activity, limits, losses, contractual liability, applicable conventions, domestic or international movement of goods, and size of operation. Gross freight receipts of mileage are always used for rating purposes in conjunction with all other relevant exposure information.

A “general average” is a loss arising from the voluntary sacrifice of any part of a ship or cargo, or an expenditure to safeguard a ship and the rest of the cargo. When the vessel owner declares a general average, the vessel owner and all the cargo interests will share the expenses associated with the loss on a pro-rata basis. These expenses are typically covered under your cargo insurance policy. Such losses can be significant and may require letters of guarantee to have the cargo released. A letter of guarantee would be issued by the insurance company and is an agreement to meet an insured’s liability for contribution.

Image placeholder

Jennie Page

Head of Marine, Marsh Specialty Pacific

Marsh Pty Ltd (ABN 86 004 651 512, AFSL 238983) (“Marsh”) arrange this insurance and is not the insurer. The Discretionary Trust Arrangement is issued by the Trustee, JLT Group Services Pty Ltd (ABN 26 004 485 214, AFSL 417964) (“JGS”). JGS is part of the Marsh group of companies. Any advice in relation to the Discretionary Trust Arrangement is provided by JLT Risk Solutions Pty Ltd (ABN 69 009 098 864, AFSL 226827) which is a related entity of Marsh. The cover provided by the Discretionary Trust Arrangement is subject to the Trustee’s discretion and/or the relevant policy terms, conditions and exclusions. This website contains general information, does not take into account your individual objectives, financial situation or needs and may not suit your personal circumstances. For full details of the terms, conditions and limitations of the covers and before making any decision about whether to acquire a product, refer to the specific policy wordings and/or Product Disclosure Statements available from JLT Risk Solutions on request. Full information can be found in the JLT Risk Solutions Financial Services Guide.”