Why You Should Consider Logistics Business Insurance

  • By land, sea and air. As a logistics business, you navigate potential hazards and setbacks to find the most efficient and cost-effective way to get goods where they need to be when they need to be there. The work you do keeps the economy moving but it comes with several risks that need to be addressed. Logistics business insurance helps you avoid some of the pitfalls that come with transporting goods and can keep your logistics business protected for the long haul.

Logistics business insurance is a comprehensive set of coverages designed specifically to address the risks common to the shipping industry. No two logistics companies are the same so the coverages are customizable and can serve single owner/operators or large fleets. We’ve listed some of the standard coverages that are usually included in a logistics business insurance package. Click on the title of each to be taken to the product page for more information.


Cargo Insurance

Ensuring your cargo is a basic requirement for any logistics business which is why Cargo Insurance is typically included in most logistics business insurance plans. Some of the benefits of having cargo Insurance specifically written to address your logistical risks can include:

  • Coverage for the full value of goods being shipped, including profits
  • Coverage according to your negotiated insurance policy without the restrictions of a carrier’s contract of carriage
  • End-to-end coverage 
  • A local agent to assist with queries and claims 
  • Less paperwork and easier reporting

Transportation and logistics cargo come with several types of risks that Cargo Insurance can address. Depending on your insurance policy, Cargo Insurance can protect you from:

Lost or damaged cargo – Coverage both domestically and worldwide for most types of cargo including: general, perishable, hazardous, valuables, heavy-lift, manufactured goods, commodities, etc.

Stock throughput risks – Coverage from raw materials to final destination. Can include coverage for goods and materials temporarily stored before they are delivered to their final destination.

Cargo and professional legal liability – Protection for the actions of third-party logistics service providers such as freight forwarders, customs brokers, warehouse staff, truck drivers and aircraft pilots.

Supply chain / trade disruption – Coverage for any extra expenses or lost profits stemming from delays or non-arrival of shipments because of disruptions in transit.

Shipment rejections – Coverage in case of cargo being rejected by a governmental agency.

Political risks – Protection for your assets and from contract frustration resulting from political unrest abroad.

Exhibition risks – protection for client goods while in transit, and while on display at trade shows. 

Hull & Machinery Insurance

If your logistics company owns and operates shipping vessels, Hull & Machinery Insurance will likely be added to your logistics insurance coverage. Hull & Machinery insurance protects a vessel or a fleet in case of physical damage occurring while it/they are in transit over water. Those vessels can include barges, tugboats, floating machinery and oil rigs among others.

This type of coverage, however, does not protect you from liability in the event of property damage or death. To be protected from these risks, protection and indemnity coverage would have to be included in your logistics business insurance.

Commercial Vehicle Insurance

Commercial Vehicle Insurance is mandatory for all vehicles being operated for business purposes and is another coverage that will likely be included in a logistics business insurance package. It can protect your logistics business from liability arising from an accident involving company vehicles used during the course of business.

Commercial General Liability Insurance

Commercial General Liability (CGL) insurance is standard for all businesses and can protect your logistics business from legal liability related to personal injury, property damage and/or false advertising. Personal injury and property damage, in this case, refers to products, services or business practices unrelated to your logistical operations – e.g. someone is injured on your property. Commercial General Liability insurance as part of a logistics business insurance plan can cover you for the costs of defending a lawsuit including lawyer’s fees, defense costs, settlements and awards for damages.

Commercial Property Insurance

Just as you wouldn’t leave your shipping vessels or commercial motor vehicles uninsured, not protecting your business property is just as dangerous. Fires, floods, windstorms, sewage backups, gas leaks, vandalism, any number of perils can happen to your logistics business. Commercial Property Insurance is an essential part of any logistics business insurance plan and can protect the structures and contents of your business property such as the physical building, office equipment, other machinery and equipment, office supplies, business records and other assets like cash and financial instruments. As a logistics company that needs to keep operating no matter what happens, we also recommend Extra Expense coverage to help with the costs of setting up a temporary workspace in case of an insured peril.

ALIGNED – Risk Management for Supply Chain Professionals

Your logistics business needs a broker that’s as reliable as you are. ALIGNED is an insurance company and our brokers are advocates that work for your best interests and deliver the professional services your insurance needs. Contact us to get a free quote on logistics business insurance in minutes.

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