Are Your Products Protected From Loss Throughout the Supply Chain?

MARCH 5, 2024

Any business that ships its products can face potential losses during the transit and storage of raw materials, stock, or inventory due to the many inherent risks to products moving through the supply chain. While standard insurance typically requires multiple policies, such as property and cargo, they often provide inadequate protection that results in limited or no recovery when a claim occurs.

USI Insurance Services’ proprietary CargoSafe program combines transit and inventory insurance into one policy to help businesses obtain:

• Broader coverage
• Higher limits
• Lower premium
• More control over the claim process
• Continuity of coverage during transit and storage
• Lower deductibles in catastrophe (CAT) prone areas

As supply chains become increasingly more complex, the risk to goods and potential coverage gaps also increases. Combining coverage for the exposures of raw materials, work-in-process, inventory, goods in storage, and product in transit, CargoSafe provides comprehensive insurance protection through all stages of the supply chain.

This is one of the few remaining programs of its kind to protect manufacturers and distributors from the volatility of open market pricing and terms, with the opportunity to eliminate third-party shipper insurance costs. It also provides access to more competitive market rates, typically 10% to 25% below standard property markets.

Benefits to Manufacturers and Distributors

Example 1:

A manufacturer that ships directly to customers had relied on freight carriers for insurance. During shipment, a fire occurred in the tractor trailer, which destroyed the entire contents of the trailer. The shipment of goods was valued at $350,000. The shipping company’s insurer settled the claim based on weight and not the actual value. It settled for $9,500, leaving the manufacturer to suffer a $340,500 loss.

When the company became a USI client, we switched them to USI’s proprietary CargoSafe program to end its reliance on cargo insurance from the third-party shipping companies. If the company had a USI CargoSafe policy at the time of the loss, the full amount of $350,000 minus the deductible would have been covered.

Example 2:

After meeting with a new client and reviewing its coverage, we recommended USI’s exclusive CargoSafe to insure its product during transit instead of insuring it through a third-party shipper. By doing so, the client was able to save 3% on overall shipping costs, creating a positive cash flow.

To safeguard goods throughout the supply chain, USI’s CargoSafe provides a single policy and seamless end-to-end coverage with market-leading protection and premium savings to the insured.