Transport insurance vs. transport liability insurance - a clarification of terms
However, it is not the job of freight forwarders or carriers to delve deeply into insurance law - there are specialized brokers such as Lutz Assekuranz for that. The following is therefore only a rough definition or differentiation aid, which should essentially make day-to-day work easier and create clarity - for special individual cases and more in-depth questions, we recommend that you contact specialists.
What is transport liability insurance?
Transport liability insurance (also known as "CMR insurance") belongs to the category of liability insurance.
The aim of liability insurance is to protect the policyholder against the financial consequences of liability claims against third parties (i.e. usually against the client - in transport law also against the recipient). This type of insurance covers damage caused by the conduct or activities of the policyholder. The policyholder assumes responsibility for damage caused to third parties through his activities.
This insurance is therefore relevant in cases where the company is held responsible for damage caused - allegedly or actually - by the transportation of goods. Such a scenario could occur, for example, if an accident occurs during transport in which the transported goods are damaged, in the event of theft or by third parties who gain unauthorized access to the cargo hold and contaminate goods there as "stowaways".
It is therefore important to note that this insurance does not protect the goods themselves or the owner of the goods, but the company carrying out the transportation. If the carrier is wrongly held responsible for damage, the liability insurance also protects him against unjustified claims - in the worst case even for legal proceedings, whether for unjustified freight deductions due to damage or for claims for damages.
What is transportation insurance?
In contrast, transportation insurance is property insurance. The major difference to liability insurance is that transportation insurance does not check who is responsible for the damage, but simply whether the damage falls under the insured events.
It comes into play when an insured object (e.g. transported goods) is damaged or destroyed by unforeseen events. The aim of property insurance is to compensate for the financial loss caused by the loss of or damage to a specific asset.
Transport insurance is a classic form of property insurance in the field of transportation. It covers damage to the transported goods themselves, which can be caused by a variety of risks during transportation. This includes both classic damage such as theft or accidents, but also unforeseeable events such as natural disasters or incorrect handling by transport service providers. The difference to the liability insurance mentioned above is that no limits are applied in terms of amount (the insurance premium is therefore based - unlike liability insurance - on the value of the goods to be declared) and that it is irrelevant whether or not anyone is liable for the damage. As long as cover is provided under the previously agreed conditions, payment can be expected.
Transport insurance is therefore not important for the carrier, who is often protected from exorbitant claims by liability limits and restrictions as mentioned above, but for the party with an interest in the goods themselves - i.e. the shipper or consignee, depending on the transfer of risk. In practice, the latter will of course contact the carrier or forwarder if they need such transport insurance, or a diligent carrier or forwarder will actively offer such an option, especially if they know that the goods are of particularly high value.
Different types of transport insurance
Transport insurance can be taken out in different ways, depending on how often transportation takes place and how high the risk is. For example, there are individual insurance policies for individual shipments or framework insurance policies for regular shipments. An experienced insurance partner such as Lutz Assekuranz can help you find the right product that meets your individual needs.
Conclusion
Both types of insurance are important for the transportation of goods, but they cover different risks. If you are unsure which insurance is best, you should consult an expert to find the right solution.