By Jennifer Chang    Photo：CANVA

In today's highly globalized world, cargo transportation has become an indispensable part of corporate supply chains. The journey of a product from its origin to the final consumer often crosses national borders and undergoes multiple modes of transportation. However, this seemingly simple transportation route hides many risks.

Natural disasters are one of the common risks during transportation. Natural disasters such as typhoons, earthquakes, and floods may interrupt transportation routes and damage storage facilities, resulting in delays or losses of goods. In addition, accidents such as car accidents, shipwrecks, etc. may also lead to damage or even total loss of goods. In addition to natural factors and accidents, theft is also a major concern during transportation. High-value goods are easy targets for criminals during transportation, especially when passing through areas with poor security environment. In addition, changes in the quality of goods, such as deterioration or damage due to environmental factors such as temperature and humidity during transportation, will also cause huge economic losses to enterprises.

When selecting cargo transportation insurance, the following factors should be comprehensively considered:

• Value of the Cargo: The higher the value of the cargo, the higher the required insurance coverage.
• Mode of Transportation: Different modes of transportation face different risks, thus requiring corresponding types of insurance.
• Transportation Route: The length of the transportation route and the risks associated with the transit regions will both affect the insurance premium.

Cargo transportation insurance acts like an umbrella, providing comprehensive protection for the owner's goods. When losses or damages occur during the transportation of the goods, the insurance company will compensate the owner according to the terms of the contract, helping the owner transfer the risk.  In the event of loss or damage to cargo during transit, the insured party should provide the insurance company with the following documents for review: insurance policy, bill of lading, commercial invoice, weight note, packing list, survey report, damage report, copies of correspondence with the carrier or other relevant parties regarding liability for damages, claim letter, and statement of loss.

Cargo transportation insurance is an important part of enterprise risk management. By purchasing appropriate freight insurance, companies can effectively reduce transportation risks, ensure the safety of goods, and safeguard the long-term interests of the company. In today's increasingly complex world of global trade, freight insurance has become an indispensable risk management tool for enterprises.

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