Determining the Correct Insurance Value for Your Cargo
Shipping your cargo/freight comes with risks. To protect against financial loss, you need to insure your cargo for its true value. This can be difficult if you don’t understand how the value of your cargo is determined. While it may seem that only the price would determine, there are other values you may need to consider.
The first step in determining value is to know the sale price of your item (including any taxes or customs fees). If you have discounted the price for any reason, it is still beneficial for you to use the MSRP to help determine its actual value. Most people use the Sale Price of their cargo to determine the insured value. This is fine if it is only products or merchandise and not something more significant.
Your cargo’s insured value may be dramatically different than its sale price, especially if it historical or other significance. If an item is being sold for $50,000 and it is considered to be a priceless work of art, you will want to get the piece appraised and then insure it for the appraised value.
Costs to Ship
The costs to ship your cargo make up the final factor. Including these fees in your insurance claim ensures that you are not caught holding the bag if something happens to the item while it is in transit. Shipping and handling costs are just as important as taxes and customs fees when calculating total insured cost.
If you are unsure of how to figure out your insurance cost, talk to a shipping and receiving agent. They will be able to help you calculate the total cost by including all of the different factors that make up the process. They can give you an itemized list and let you know how much insurance you will need to be fully protected.