In the world of shipping, the distinction between declared value and cargo insurance is a subtle yet significant one. Many shippers operate under the assumption that by declaring a value for their parcel with carriers like USPS, FedEx, or UPS, they’ve secured insurance. However, this declaration merely serves as a liability cap, not actual insurance.

The Limitations of Declared Value

Declared value with major carriers does not ensure compensation for your entire loss. These carriers require proof of their wrongdoing before compensation, placing the burden of proof squarely on the shipper. This can complicate and prolong the claims process.

Why Cargo Insurance Matters

True cargo insurance provides a different level of assurance. The claims process is often more straightforward and faster, requiring minimal evidence of carrier fault. This can mean the difference between waiting indefinitely for resolution and facing inconvenient delays. An effective cargo policy functions as a genuine safety net, extending beyond the limitations of carrier liability.

It’s in one’s best interest to recognize the breadth of security actual cargo insurance provides against unforeseen events, from weather disruptions to accidental damages that carriers might not acknowledge as their fault.

In my years of experience, I’ve found that a bespoke approach to protection is invaluable for businesses. Investing in comprehensive cargo insurance isn’t an indulgence; it’s a prudent measure. Shippers deserve true protection that doesn’t hinge on proving fault.

Andria Baunee is the principal broker at National Heritage Risk – a boutique insurance brokerage that caters exclusively to medium-sized fleets in the United States. For more information, email Andria@NationalHeritageRisk.com or call (716) 402-8686.