How Manufacturers Manage Transit Risks

contingent cargo coverage insurance
By understanding the unique risks associated with transporting products through the distribution chain, diligent manufacturers protect products from damage.

Manufacturers must reach customers around the globe to remain competitive in the modern marketplace. Since most of these companies don’t own or operate common carrier services, they must rely on third-party organizations to transport their products to their customers. When goods leave a factory or warehouse, they face many potentially devastating hazards during transit. To mitigate these risks, diligent manufacturing managers purchase contingent cargo coverage insurance.

Understanding Shipping Risks

To get products from the factory to customers, manufacturers utilize airplanes, boats, trucks, and trains. This supply chain involves collaborating with personnel around the world. When companies place their products into the distribution chain, they face the risks:

  • Damage to Products Due to Vehicle Collisions
  • Damage to Products Due to Weather Events
  • Damage to Products Due to Rough Handling

Mitigating Shipping Damage

When they purchase contingent cargo insurance coverage, manufacturers intend to protect their products regardless of their position in the distribution chain. Unfortunately, because cargo policies are not regulated by state law, company executives cannot rely on cargo policies to be standard. Instead, they often must work with knowledgeable insurance providers to secure protection in the following areas:

  • Warehouse Coverage
  • Storage Insurance
  • Stock Throughput

By understanding the unique risks associated with transporting products through the distribution chain, diligent manufacturers protect products from damage. Instead of relying on chance or ineffective coverage, then, these companies ship with confidence and better serve their customers.