Two Confusing Terms in Transport Coverage

Those operating in the transportation industry are familiar with the terms carrier liability and cargo liability insurance. Many assume they are the same thing, but there are some significant differences that help tell the two apart. Knowing these differences is important in making sure you have retained the right protection and coverage for your load.

Carrier Liability

Whoever is carrying the load between locations will offer some type of limited liability coverage. Usually, the amount of coverage depends on the freight class and type of goods. Coverage with carrier liability is generally offered according to a certain dollar amount per pound of transported freight. Unfortunately, this is often much less than the actual cost of the commodity in transport. It also carries limitations with weather-related damage or improper handling that causes concern.

Cargo Liability Insurance

When a company offers cargo liability coverage, there is usually an additional charge to the clients but it offers more comprehensive protection for the goods in question. This coverage usually has a limit that is closer to the actual value of the freight, providing more peace of mind in the event that something happens to the load.

There are differences in claims processing between each type of insurance. It is best to check with your carrier and a local agency to find out which coverage is right for your cargo.