8 Ways to Manage Transportation Insurance Costs

March 20, 2018

Business, Insurance, News

There are various ways to increase or reduce the costs associated with transporting goods and products. Reducing costs can often influence the quality of transportation, and increasing costs can often influence any premiums you may pay in case of problems.

Here’s eight things to consider when trying to manage the insurance cost of goods transportation:

1. Factor in varying deductable levels. Deductible levels have a direct impact on the premiums you pay, and also keep in mind that deductibles are considered as part of risk mitigation.

2. Take loss prevention seriously! Integrate policies related to loss of controls and devicess. THese types of policies can relate to the tracking and monitoring of assets and technologies. By participating in active loss prevention strategies and policies, your cargo has a much better chance of arriving at its destination as specified.

3. Look into alternatives. Evaluate risk-factors with regards to the terms of the sale agreement. This may allow you to shift some of the associated insurance obligations and other freight risks over to your trading partner during any initial contract. Basically, look at other ways to eliminate the risk, so your trading partner takes on part of this responsibility.

4. Maximize recovery potential. Basic steps like ensuring customary cargo transport units are all numbered correctly, will certainly increase the liability, loss and damage for the carrier. See if you can negotiate with transport companies for offers of increased liability limits.

5. Full disclosure of operations! Keep your insurance company fully aware of your operations, the supply chain, shipment and logistics preparations. The more information you disclose about your businesses operation, the better for your insurer to price or underwrite decisions.

6. Ensure your business does not buy insurance limits that exceed the worth of the goods you intend to ship.

7. Choose a highly skilled logistics company. The competency of the transport companies is an important factor for the underwriting criteria. The reputation and standing of the transport companies you use to transport goods will influence the cost of your insurance policy.

8. Manage risk! Develop plans and processes around mitigating risk. Incorporate relevant departments such as; compliance, finance, production, safety guides, security management, planning and the supervision and monitoring of associated transport activities.

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