The freight transport segment is going through difficult times, as it is affected by record high fuel prices, further adversely impacted by increase in diesel fuel excise duty, and shortage of drivers. At the same time, high inflation is directly reflected in rapidly increasing value of transported goods, which in turn leads to the need to ensure adequate insurance cover against transport risks that carriers, freight forwarders, and owners of transported goods face every day.
The basic insurance products that cover transport-related risks include liability insurance for road carriers / freight forwarders and cargo insurance. These are optional insurance products; however, they have become quite essential; indemnification limits and sums insured are determined by clients based on the value, nature, and mass of transported goods.
The mass of goods relative to their high value represents one of the factors that should determine the suitability of insurance protection for specific types of goods.
After all, road carriers’ primary liability and their obligation to compensate in connection with international and domestic transports are determined on the basis of the mass of goods, regardless of their actual value. Unfortunately, this fact is still frequently ignored and carriers are pressured to contractually increase their liability that is often not covered by insurance.
On the other hand, with cargo insurance, owners of transported goods can benefit from all-risk coverage throughout the period of transport, regardless of carriers’ liability, up to the actual value of their goods. There is a growing demand for this insurance among parties to international trading transactions, as it allows them to focus on their core business without having to worry about potential financial implications of the transport of goods.
Increasing integration of economies around the world, including cross-border movement of goods, leads to higher interdependency of the world economy that is much more sensitive to fluctuations in transport chains and global production. The war conflict in Ukraine and the associated sanctioning regimes have been significantly affecting transportation of goods worldwide, particularly imports from China to the Czech Republic. International sanctions primarily affect shipments originating from the so-called “sensitive sectors” – dual-use goods, energy, and petroleum products. Consequently, owners of transported goods must monitor current sanctions that may apply to specific territories, individuals or types of transported goods. This also affects carriers, since the mere existence of sanctions or war conflicts does not (automatically) constitute grounds for exempting them from liability.
The role of the insurance broker RENOMIA that provides clients with individualized analyses of risks arising from transportation of goods and offers expert advice and adequate insurance protection across a range of international insurance services is thus absolutely crucial in connection with each of the aforementioned risks.
Transport & Logistic Director RENOMIA
Phone: +420 604 119 079