Types of Freight Insurance
Freight carriers have a legal obligation to provide a minimum amount of liability insurance, usually 10 cents per pound as listed on the Bill of Lading or invoice. Called “contingent insurance,” it is usually insufficient and provides only minimal compensation to you by the carrier in case of loss or damage.

Supplementary freight insurance is usually referred to as “primary insurance,” has much higher coverage terms and may even supersede contingent insurance if an incident occurs.

How to Purchase Insurance for a Business or Industrial Freight Shipment
Adding additional insurance to a business freight shipment does not need to be complicated. You should be familiar with what you need to do in advance of buying a supplementary policy, what to do when your shipment arrives, and how to make a claim in case anything is damaged.

• Can it be insured? Depending on what you are shipping and how it is getting there, coverage may carry certain limits.
• What are the terms of insurance coverage? Determine how much the policy will cost, deductibles amounts, and exactly what parts of your shipment will be covered. Pay careful attention to any parts of the contract that detail exclusions.
• Is the shipment properly prepared and packed? Make sure all paperwork is accurate, and that the shipment has been properly crated or palletized as necessary. In case of a claim, these items will be checked.
• How reliable is the underwriter of the policy? Many different policies may share an underwriter. Independent insurance rating companies such as Fitch, Standard & Poor, and A.M. Best issue ratings for insurers. Concentrate on financial strength and claims payment ability ratings in particular.

• Inspect your shipment together with the driver, and take specific notes of any loss or damage.
• Examine your goods in further detail, noting the details of any hidden damage and taking photographs of it.

• Contact both the service provider and your insurance company as soon as possible, preferably within 24 hours of delivery.
• Keep a record of the names of any company representatives you speak to.
• Assemble your copies of paperwork and any other documentation so that they are easily accessible in case you need to reference them.