Cargo theft is a daunting challenge within the transport sector, with freight trucks being prime targets for thieves. These criminals employ a variety of methods, from slashing tarpaulins to vandalizing trailers. Regrettably, stolen cargo is often unrecoverable, triggering a series of procedures to assess the damage, establish liability, and uncover the circumstances surrounding the incident. This involves cooperation among insurance companies, cargo owners, carriers, and law enforcement, all driven by a shared goal: minimizing the material consequences and ensuring swift compensation. At Cargofort, we recently managed a case involving the theft of nice pallets, and here’s how we successfully resolved it. 

The Facts

Our client, a transport company, was tasked with transporting goods from Bulgaria to England. After the mandatory rest break for the driver in England, he made a shocking discovery the next morning: a gaping hole in the tarpaulin and all nine pallets of cargo were gone. 

The Challenges 

In such thefts, a common tactic is to drug the sleeping driver, allowing thieves ample time to make off with the cargo. In this case, the driver remained oblivious during his break, raising questions about his account of events.  

Action

We promptly informed all stakeholders in the transport chain about the incident. Since the cargo was insured by its owners, the cargo insurer was obliged to compensate based on the invoice value and then file a recourse claim against the responsible carrier. At this stage we’ve informed the claimant and his cargo insurer that our insured’s liability is limited and that higher claims won’t be accepted. We also notified the “Carrier’s Liability” CMR insurer on behalf of our customer. Given the complete theft of the goods, an immediate inspection wasn’t necessary. Our next step was to engage the English police to obtain an official police report (which is mandatory document for every insurer). 

Rules

According to the CMR Convention Art.17.1, the carrier is responsible for cargo from pickup to delivery. Together with that, according to Art. 23. 3, when the carrier is at fault for the total or partial loss of goods, a liability limit applies, calculated at 8.33 SDR per kg. of the missing cargo’s gross weight. However, if the damage results from the driver’s gross negligence or willful misconduct, the carrier is liable in full (according to Art. 29 CMR Convention). Moreover, the claimant is entitled to claim the transport cost reimbursement proportional to the missing/lost goods (according to Art. 23. 4). 

Results

After supplying all the necessary documentation, the cargo insurer sent a recovery claim to our insured client and its CMR liability insurer, seeking compensation within the stipulated limit, which basically was half of the invoice value of the goods. The transport freight amount was claimed as well, since the freight charge was previously paid by the claimant. As an insurance broker, our role is to maintain clear and transparent communication with all parties involved, leading to a well-justified and legally sound resolution. Thanks to these qualities, Cargofort achieved a positive outcome in this case—the CMR liability insurer approved the claim value and paid the sought compensation. 

Conclusions

This case study underscores the importance of understanding and correctly interpreting the regulations governing the road transport sector. Insurance companies must gather comprehensive information to objectively analyze incidents and earn the trust of their clients. Having insurance brokers with an open-minded approach, adept at guiding the process to an effective resolution, offers peace of mind for every transportation company. With Cargofort at your side, you can concentrate on your core business while we safeguard your material interests. 

CARGOFORT

Every day, countless shipments of goods traverse the vast oceans and roads, making their way to their intended destinations. Behind the scenes, Cargo insurance plays a pivotal role in safeguarding these shipments. However, there’s a hidden danger that can threaten the very essence of this protection – inaccurate declarations about the cargo. 

In this article, we will embark on a journey to explore the critical issue of inaccurate declared information about the shipments in cargo insurance. We will uncover the dire consequences that can arise when the type or parameters of goods are not properly declared and learn how these pitfalls can be avoided. 

The Consequences 

Imagine this scenario: A shipment of valuable electronics arrives at its destination, but upon inspection, it’s discovered that the cargo was improperly declared as ordinary household items. Suddenly, the cargo insurance policy that should have provided peace of mind becomes a source of frustration and financial burden. 

The consequences of inaccurate cargo declarations can be severe. First and foremost, insurance claims can be denied. When goods are not declared accurately, it can create coverage gaps, effectively rendering the policy useless. Denied claims can lead to substantial financial losses and jeopardize the financial stability of businesses involved in shipping. 

Legal implications also loom large. If inaccuracies in cargo declarations are discovered, it can lead to disputes, litigation, and even criminal charges in some cases. Furthermore, the reputation of the involved parties can be tarnished, impacting their ability to conduct future business. 

To illustrate the gravity of these consequences, consider a recent case where a shipment of perishable goods was incorrectly declared as non-perishable. When the cargo arrived spoiled, the insurance claim was denied due to the inaccurate declaration. The financial hit was substantial, and it took years of legal battles to reach a resolution. 

Common Reasons for Inaccurate Declarations 

Why do inaccurate cargo declarations occur? There are several common reasons behind this problem. One of the primary causes is miscommunication. In complex supply chains involving multiple parties, miscommunication can easily lead to misunderstandings about the nature of the cargo. 

Oversight and lack of attention to detail are also significant contributors. In the rush to meet shipping deadlines, essential details about the cargo can be overlooked or underestimated. Sometimes, cargo is intentionally misdeclared to avoid higher insurance premiums or taxes. 

Addressing these issues requires a proactive approach. Improved communication among all stakeholders, including shippers, carriers, and insurers, is essential. Furthermore, a rigorous process of documentation and verification can help catch inaccuracies before they become a problem. 

Solutions and Best Practices 

To protect against the dire consequences of inaccurate cargo declarations, adopting best practices is paramount. Here are some steps to ensure that cargo declarations are accurate: 

Thorough Documentation:

Maintain detailed records of the cargo’s nature, value, and packaging. Documentation should be transparent and easily accessible to all parties involved. 

Verification Process:

Implement a verification process that involves cross-checking cargo details at various points in the supply chain. This includes verifying the cargo’s condition during loading and unloading. 

Modern Technology:

Leverage modern tracking systems and technology to monitor cargo in real-time. These systems can help detect discrepancies early and provide valuable data for accurate declarations. 

Experienced Professionals:

Work with experienced professionals who understand the complexities of shipment information and cargo insurance. Their expertise can help navigate potential issues. 

In Conclusion

Inaccurate declared information about the cargo can transform the protection provided by cargo insurance into a mirage. Denied claims, legal disputes, and damaged reputations are just a few of the dire consequences that can result from this problem. 

However, by understanding the gravity of the issue, addressing common causes, and implementing best practices, businesses can safeguard their cargo, insurance coverage, and reputation. The key is to approach cargo information with the seriousness they deserve, ensuring that shipments are accurately represented, and insurance policies provide the intended protection. 

Don’t let inaccurate cargo declarations become your downfall. Take proactive steps today to ensure that your cargo insurance coverage remain solid and reliable. In the dynamic world of global trade, accuracy is your best ally. 

CARGOFORT

PART 5

Forwarder’s Liability Insurance: Unlock the POWER!

In the fast-paced world of freight forwarding, success means more than just going with the flow. It’s about taking control and staying ahead of the competition. As the industry continues to evolve, embracing innovation and setting new standards are essential. By constantly pushing boundaries and thinking innovatively, you can establish yourself as a leading pioneer in the field of forwarding. 

Why Forwarder’s Liability Insurance Matters for Your Business 

In this series, we’ve explored Forwarder’s Liability Insurance, shedding light on its pivotal role in the freight forwarding industry.

We began by discussing the fundamental reasons behind its importance, both as a legal obligation and a strategic advantage. We delved into the diverse contracts and activities of forwarding companies, underscoring the critical need for customized insurance coverage. It’s essential to tailor insurance to these unique contracts and to clarify the forwarder’s accountability, even when subcontracting.

In the third installment, we examined the various risks covered by Forwarder’s Liability Insurance. These risks encompass damages, shortages, theft, delays, and errors, making comprehensive coverage vital. We stressed the importance of including subcontractor liability and poor vehicle conditions within this coverage.

In the fourth article, we detailed how Forwarder’s Liability Insurance claims are resolved. We emphasized the significance of selecting the right insurance partner and outlined the standard claims resolution process. This process includes reporting the claim, securing payment, and recovering from responsible subcontractors. We also discussed the insurer’s role in defending against unfounded or incorrect claims in court.

As we conclude this series, you now possess a comprehensive understanding of Forwarder’s Liability Insurance.

This knowledge, spanning its necessity, coverage, and claims resolution, equips you to navigate the complex world of forwarding successfully.

Why Choose Cargofort? 

Ready to Secure Your Future? 

Ready to take action and to ensure your freight forwarding endeavors with the right insurance coverage? Don’t wait any longer. Click here to fill out our free online inquiry form, and our experts will be in touch to discuss your specific requirements. Take the first step towards a more secure future for your freight forwarding company with CARGOFORT. 

PART 4

In our previous articles: Part 1, Part 2 and Part 3 we’ve delved into the dynamic world of freight forwarding, where risks and uncertainties can loom unexpectedly, having the right strategy to navigate claims and damages is essential. In our ongoing exploration of Forwarder’s Liability Insurance, we delve into the critical process of resolving claims and how this insurance shield empowers forwarders to confidently tackle challenges head-on. 

Building on a Solid Foundation 

As we’ve previously discussed, selecting the right insurance partner and designing terms that comprehensively cover various contracts and activities set the stage for a seamless claims resolution process. When the unforeseen occurs – whether it’s damage, loss, or other insured events – the process unfolds with clarity and efficiency. 

A Timely Notification 

When an incident triggers the need for a claim, timely communication is key. The freight forwarder should promptly notify the insurer and the subcontractor, initiating a structured sequence of steps. This immediate notification ensures that the necessary actions can be taken to assess and address the situation swiftly. 

Validation and Assessment 

Upon receiving the claim, the insurer diligently evaluates its validity. This includes an assessment of whether both the insured company and its subcontractor bear liability for the event. The insurer then verifies the accuracy of the damage calculation, ensuring that the claimed value aligns with the reality of the situation. 

Streamlined Compensation 

Once the assessment is complete and the claim is deemed valid, the insurer proceeds to facilitate the compensation process. With Forwarder’s Liability Insurance in place, the forwarder gains the advantage of a partner ready to fulfill their obligations promptly. The insurer’s commitment to efficiency and support ensures that the insured receives the compensation they deserve, alleviating the financial burden caused by the incident. 

Recovery and Resolution 

But the story doesn’t end here. Following the compensation, the insurer takes the next logical step by engaging the responsible subcontractor whose actions led to the initial liability. By recovering the value of the paid damage from the subcontractor, the insurer ensures that the forwarder doesn’t bear the brunt of the loss under their policy. This comprehensive approach to recovery protects the interests of all parties involved. 

Defending Unfounded Claims 

In cases of unfounded or incorrect claims, Forwarder’s Liability Insurance acts as a shield. The insurer stands by the side of the insured, actively rejecting claims that lack merit and offering support if the situation escalates to legal proceedings. This safeguard not only upholds the forwarder’s integrity but also maintains their financial security. 

A Journey Continues 

With this insight into the claims resolution process, our journey through the world of Forwarder’s Liability Insurance advances. As we stand on the brink of the fifth and final article in this series, we’re excited to unravel the remaining layers and equip you with the knowledge you need to thrive in the world of freight forwarding. 

Stay tuned for the culmination of our series, where we unveil the last piece of the puzzle and help you take the final steps towards securing your success. 

Warm regards, 

Cargofort 

P.S. The final piece awaits! Brace yourself for the fifth and concluding article in our Forwarder’s Liability Insurance series. Subscribe to stay informed and empowered.  

PART 3

Safeguarding Against the Unknown: The Comprehensive Coverage of Forwarder’s Liability Insurance  

In our previous articles: 1. “Unlocking Success with Forwarder’s Liability Insurance: Your Journey Starts Here,” and 2. “Building Upon Success: A Continuation of the Forwarder’s Liability Insurance Series – The Necessity for Every Forwarding Company”, we’ve delved into its significance, necessity, and the foundation it provides for businesses venturing into the world of freight forwarding. Now, in this third article of our series, we’re poised to uncover the crucial aspect that forms the very essence of this insurance: the risks it aptly shields you against. 

What Risks Does Forwarder’s Liability Insurance Cover? 

Imagine a landscape where your business’s activities are meticulously protected from the unexpected, where every conceivable risk is met with a robust safety net. This is precisely what “Forwarder’s Liability” operating insurance entails. It’s tailored to encapsulate the gamut of risks entailed by the operations of your esteemed company. 

Every action in the realm of freight forwarding involves an inherent set of risks, from the intricacies of transportation to the nuances of logistics. “Forwarder’s Liability” insurance stands as the guardian against these uncertainties, providing comprehensive coverage that safeguards your interests. 

Here’s a glimpse into the risks that this insurance steadfastly covers:

Damages, Shortages, and Thefts:

Whether it’s unforeseen damages to goods, shortages, or the unfortunate event of theft, this insurance steps in to mitigate the financial blow. 

Delivery Delays:

In the fast-paced world of logistics, even the slightest delay can trigger a chain reaction of setbacks. Forwarder’s Liability Insurance ensures that you’re shielded from the repercussions of delays beyond your control. 

Misdirected Shipments:

The complexities of forwarding can occasionally lead to shipments being directed to the wrong address. With this insurance, you’re fortified against such occurrences. 

Errors and Omissions:

As meticulous as your processes might be, human errors can still occur. Whether it’s a wrong calculation or a missed step, the insurance cushions you from the financial consequences. 

Loading and Unloading Mishaps:

In warehousing and logistics, loading and unloading operations are at the heart of the process. This insurance encompasses the damages that might arise during these pivotal moments – from improper stacking to cargo loaded for the wrong destination. 

Liability of the Subcontractor:

The Forwarder’s Liability Insurance extends its reach to cover events that arise due to the actions or negligence of subcontractors, as defined by Article 3 of the CMR Convention. 

Willful Misconduct (Gross Negligence):

In the event of willful misconduct or gross negligence, whether committed by the freight forwarder or the subcontractor chosen for the transport, this insurance stands as a shield against the financial repercussions, as per Article 29 of the CMR Convention. 

Vehicle Technical Issues:

Even the best-laid plans can be disrupted by technical issues in the vehicles used for transportation. This insurance recognizes the impact of poor technical conditions, ensuring you’re shielded from resultant damages. 

By ensuring that your Forwarder’s Liability Insurance comprehensively addresses these risks, you’re securing your business’s stability against the unforeseen. In the event of a claim, a well-structured insurance plan becomes your lifeline, shielding your financial health. 

A Sensible Investment for Long-Term Security 

When your freight forwarding endeavors are backed by the right insurance coverage, you’re not just making a prudent choice – you’re empowering your company to navigate the industry’s challenges with confidence. Operating without adequate coverage is akin to sailing in treacherous waters without a map or compass. 

Stay tuned for our next article in this series, where we’ll unravel more layers of the Forwarder’s Liability Insurance tapestry, providing you with the knowledge you need to steer your business toward a prosperous future. 

Cargofort 

*P.S. Haven’t caught up on the previous articles yet? Dive into our series and embark on a journey of comprehensive insight:  

Article 1: “Unlocking Success with Forwarder’s Liability Insurance: Your Journey Starts Here,” 

Article 2: “Building Upon Success: A Continuation of the Forwarder’s Liability Insurance Series – The Necessity for Every Forwarding Company”, 

PART 2

The Necessity for Every Forwarding Company 

In our previous article, “Unlocking Success with Forwarder’s Liability Insurance: Your Journey Starts Here,” we embarked on a journey to explore the world of Forwarder’s Liability Insurance and its pivotal role in the realm of freight forwarding. Today, we plunge further into why this insurance is a must-have for every forwarder. Join the essential journey!

– Transportation

– Forwarding

– Storage

– Logistical Activities

Highlighting again, the diverse contract nature emphasizes aligning “Forwarder’s Liability” insurance with unique contract conditions for seamless coverage. Moreover, it must also adhere to the conventions and regulations governing the specific contract type. Take, for instance, the scenario of a forwarder entering a road transport contract. Despite subcontracting the actual transportation, the forwarder is regarded as the contracting carrier according to Article 3(2) of the CMR Convention. This implies that for any instances of loss, damage, theft, or delays, the forwarding company bears full responsibility as stipulated by the relevant Convention. The forwarder cannot sidestep accountability by shifting blame to the subcontracted transport. In such situations, the forwarder serves as more than a mere agent or operator. They are the contracting carrier, orchestrating the transportation process and invoicing for their services. 

We emphasize this fact and contract type due to a prevalent misconception we’ve encountered. Among 1000+ Bulgarian forwarding companies, a misconception persists: damage blame falls solely on subcontractors, not the forwarder. This notion, however, doesn’t hold true, particularly for the specific contract type mentioned earlier. 

Cargofort 

*P.S. For those who missed our initial article, catch up here: Unlocking Success with Forwarder’s Liability Insurance: Your Journey Starts Here. Explore our publications for more valuable insights on Transport Liability & Cargo Insurance and the path to success in the world of Logistics. 

PART 1

Embracing Success in Freight Forwarding

In the bustling world of freight forwarding, where every decision shapes your business’s fate, a single choice stands between success and uncertainty. Are you ready to join the top 10% of companies who aren’t just thriving, but leading the way in the transport and logistics arena? Welcome to Cargofort Ltd, your key to safeguarding your business’s future.

Shielding Your Business: Introducing Forwarder’s Liability Insurance

Picture this: You’ve signed contracts for transport, forwarding, and logistics with your clients. These contracts are more than agreements; they’re the lifeline of your business. That’s where “Forwarder’s Liability” insurance steps in – not for the average, but for those who dare to embrace calculated risks.

Imagine a world where, despite your best efforts, unexpected setbacks occur. Your team or even a trusted subcontractor stumbles, leading to costly consequences. What if you could turn back the clock and shield your business? This isn’t just insurance; it’s your strategic advantage.

A Safer Tomorrow: The Power of Contractual Liability

“Forwarder’s Liability” insurance isn’t just about clauses; it’s about trust and security. It covers not only the actions of your team but also the ripple effects caused by collaborations. Think of it as a safety net woven from your contracts – those legal and moral commitments. This isn’t just a policy; it’s your promise to uphold excellence, no matter the challenges.

Beyond Protection: Navigating the World of Coverage

Why the spotlight on contractual liability? Because understanding it is your ticket to comprehensive protection. It’s your chance to rise above the crowd and lead with confidence. Take land transport contracts as an example. The CMR Convention, Article 3 (2), encapsulates the essence of safeguarding your business.

The journey we’ve embarked upon is just beginning. The horizon holds deeper insights into the world of “Forwarder’s Liability” insurance – the different risks it guards against, the layers of coverage, and the power of foresight.

Guiding Your Path: Partnering with CARGOFORT

As we chart this course together, know that we’re here to guide you. Each article in this series is a step toward a more secure, empowered future for your business. We’re not just offering information; we’re extending a partnership that transforms.

Stay tuned for the upcoming chapters where we unravel the intricacies, celebrate success stories, and equip you to make choices that redefine your business’s trajectory.

Claiming Your Success: Take Action Now

The path is set, the compass points forward, and the destination is clear. Are you ready to not just read about success, but to claim it? Stay engaged with CARGOFORT, and together, we’ll turn your aspirations into achievements.

Become a part of the journey. Explore our article, share your thoughts, and let’s pioneer a future that’s secure, thriving, and boundless.

Cargofort  

In recent years, the insurance industry has experienced a remarkable transformation, driven by the unstoppable rise of insurtech. This merging of insurance and technology has brought about a new era of innovation, empowering insurers, and policyholders alike. By streamlining processes, enhancing customer experiences, and leveraging cutting-edge technologies, insurtech is reshaping the insurance landscape at an astonishing pace. Let’s delve deeper into this revolution and explore how technology is revolutionizing the insurance industry. 

Automation and Efficiency: 

Insurtech solutions have significantly impacted the insurance industry by automating processes that were once manual and time-consuming. According to a report by McKinsey & Company, automation can reduce administrative costs by up to 50%. Tasks such as policy issuance, underwriting, and claims processing can now be performed swiftly and accurately using advanced technologies. This saves time for both insurers and customers while improving overall operational efficiency. 

Data Analytics and Personalization: 

Insurtech leverages data analytics to gain valuable insights into customer behavior and risk profiles. Insurers can analyze vast amounts of data to develop more accurate risk models and make informed underwriting decisions. This data-driven approach allows insurers to tailor policies to individual needs and preferences, providing customers with personalized coverage options. According to a survey conducted by Accenture, 80% of insurance executives believe that data-driven insights will become a competitive advantage in the industry. 

Artificial Intelligence and Machine Learning: 

The integration of artificial intelligence (AI) and machine learning algorithms has revolutionized the insurance industry. AI-powered systems can process and analyze complex data sets in real-time, enabling faster and more accurate claims processing. Chatbots and virtual assistants powered by AI provide instant customer support, personalized recommendations, and efficient policy management. A study by PwC suggests that AI and machine learning have the potential to automate up to 25% of insurance tasks, leading to significant cost savings. 

Blockchain Technology and Trust: 

Blockchain technology has found a natural fit in the insurance industry, enhancing trust, security, and transparency. Insurers are leveraging blockchain to streamline processes such as policy issuance, claims settlement, and fraud detection. The decentralized and immutable nature of blockchain ensures the integrity of transactions and reduces the risk of fraud. A report by MarketsandMarkets predicts that the blockchain market in insurance will reach $1.4 billion by 2023, showcasing the growing adoption of this technology. 

Innovation and Disruption: 

Insurtech has paved the way for innovative insurance products and business models. Startups and tech giants are entering the market with fresh ideas and disruptive technologies. For example, peer-to-peer insurance platforms allow individuals to form communities and share risks collectively. On-demand insurance solutions provide coverage for specific events or periods, offering flexibility and affordability. This wave of innovation is challenging established players and forcing them to adapt to the changing landscape. 

Insurtech is driving a seismic shift in the insurance industry, transforming the way insurers operate and customers engage with their policies. Through automation, data analytics, AI, machine learning, and blockchain, insurtech is revolutionizing processes, enhancing risk assessment, and delivering personalized experiences. Reliable sources such as McKinsey & Company, Accenture, and PwC emphasize the impact of insuretech on the insurance industry. As technology continues to advance, the future of insurance promises to be faster, smarter, and tailored to individual needs, creating a more efficient and customer-centric industry. 

Sources: 

1. McKinsey & Company: “Claims transformation in insurance through automation and advanced analytics.”
2. Accenture: “Insurance Technology Vision 2019.”
3. PwC: “Insurance 2022: The impact of AI on the future of insurance.”
4. MarketsandMarkets: “Blockchain in Insurance Market by Provider

Cargofort  

In the last few years, online trade /e-commerce/ in Bulgaria

has seen significant growth from year to year. According to information published in Capital by the Bulgarian E-commerce Association (BEA), citing data from the “Passport of the e-commerce industry in Bulgaria 2022”, the expected growth in B2C (business to end user) for 2022 is 30% and a volume of 1.64 billion EUR compared to the previous year 2021. The trends are this percentage to grow. Together with this, the expectations and demands of the buyers towards the Internet merchants are increasing. 

According to statistics, the most frequently purchased goods are: clothes, shoes and accessories. Sports goods. Furniture and home goods. Consumer electronics and equipment (laptops, phones). 

The delivery methods chosen by users are: door delivery (63.83%). Courier office delivery (32.66%). Pick up from physical store or courier locker (3.50%). 

In relation to these trends, below we will address the important aspects of ensuring the risks that exist for online stores and consumers when the goods are sold, shipped and delivered. 

Most of the goods listed above

tend to be expensive, light, fragile, and susceptible to getting wet, damaged, or missing. Therefore, online traders should ensure shippers provide adequate compensation protection during transportation. And adequate and suitable packaging, of course. A small number of buyers of goods from online stores are aware that they must also purchase an insurance for their shipment before pressing the “complete order” button. That is in order to be able to receive full compensation in the event of the absence or damage of the ordered goods. The correct solution to this is for sellers to provide the necessary information to consumers about the risks that exist in advance. Along with this, merchants need to have the right integrated solution. Which enabling their customers to quickly and easily insure their shipments for the risks that exist during their movement from the point of loading to the point of destination.  

Why is this crucially important?

The majority of all shipments ordered from online stores are transported by couriers. Their liability for damage, loss and theft is limited according to their own terms and conditions. Or according to national legislation. 

In on one of our previous articles we have explained the difference between cargo insurance coverage and the carrier’s liability. And the applicable limits for international transport.

In the standard case where the ‘declared value’ option is not included, there is a limit to the compensation that can be obtained. I.e. customers may be unpleasantly surprised to lose money due to damage. For different companies, this limit varies, but the basic “standard” compensation is up to BGN 15 per damaged or lost shipment. In other cases it is up to the actual value of the damage, but no more than 5 to 10 times the value of the courier service. 

Couriers offer the option of “declared value”. For an additional fee of 0.5% to 2% of the value of the shipment (the value you declared), buyers guarantee themselves full coverage for the goods  which they order. By paying this significant additional amount, especially for more expensive goods, consumers have the option for full compensation up to the amount of damage/loss. However, there are couriers which limit the maximum amount of their compensation (for example up to 5000-10000 BGN per shipment). In order for customers to benefit from compensation, they must also comply with the specific conditions of individual courier companies. They include: putting a remark on the bill of lading and photographs. Notification period, validation period and the decision for compensation which the couriers make. 

How can e-commerce companies guarantee 100% coverage and satisfied customers?

Cargo insurance guarantees full coverage up to the value of the shipment during transit, so that the financial interest of traders and consumers comes first. Without the risk of losing money due to damaged and lost shipments. The insurance of the goods is completely under the control of the online stores and consumers. I.e. they decide how and whento conclude it. The other main advantage of this type of coverage solution is that its terms are internationally standardized. This applies to standard covered risks as well as excluded risks that are specifically listed. This is a major difference to the above-mentioned coverage conditions of courier companies. They determine themselves the conditions under which they should protect shipments. When using cargo insurance, each e-commerce company can and should negotiate their special coverage terms to suit their specific business processes.

That is why it is important to choose a competent insurance broker who is aware of all the small details. In that way he will be able to draft the terms of the policy so that they work in favor of the insured. 

Of no less importance, cargo insurance rates are much lower than those of “declared value”.

When setting rates for a subscription cargo policy that online stores can take out, it is not always necessary to apply a “hard” fixed rate. The rate is optimized according to the type of goods that are covered and their risk class. This is because it makes a significant difference whether a laptop, garden equipment or glassware is insured. Such a solution works in favor of the user. 

Online retailers must have excellent resolution for complaints and problems regarding damaged or lost shipments for better customer experience. When the end user receives his ordered item broken, he should be aware of the steps to submit a claim and who to contact. By using cargo insurance as a solution, the notification and claim process is also standardized. With pre-defined steps to resolve issues. This can be done through an integrated claim submission, management and resolution system. This is a significant advantage over working with different courier companies with different conditions. Where in order for a user to solve his case, he should go through a call through a service center, be redirected several times and make several unnecessary steps to solve his problem.

The cargo damage solution on the other hand allows consumers and merchants not to be involved in the process entirely.

They need only to be informed of the status of the development of each claim. As mentioned above, after completing pre-defined notification and providing basic info and documents, claims are quickly resolved. Afterwards compensation is paid to the insured and customers remain satisfied. 

Every e-commerce platform has enough experience with customer satisfaction management

That’s why they should be aware that with an adequate solution of damage and loss cases, they strengthen their reputation towards the end user. In that way, they reaffirm that even in difficult situations, they have an easy-working solution. Thus, customers remain satisfied and would prefer to order from this online store again. And for the trader, it is precisely the good insurance decision that predetermines the positive financial result after such incidents. 

In conclusion

An integrated online insurance solution is crucial for a successful business model due to automation in online processes. Insurtech companies have the products and the systems that allow e-commerce companies to provide their users with the necessary risk coverage. As well as a significantly better level of resolution of problems with the sold products. All of this influences which e-commerce platform customers pick for their next purchasing journey. 

Cargofort