Freight Forwarder Liability Insurance ~ Insurance Academy

Freight Forwarder Liability Insurance is insurance that provides protection against liability in shipping, errors and omissions of third parties arising in the operations of the carrier. From the name, this insurance is certainly intended for Freight Forwarding Services companies.

Freight Forwarding Services is a service company that deals with the receipt, transportation, consolidation, storage, delivery, logistics and or distribution of goods along with additional services and advisory services related to them, including customs and taxation activities, the obligation of notification of goods for the purposes of government agencies, closing insurance of goods and or payment of bills or documents related to the goods.

Broadly speaking, the services of Freight Forwarding or Freight Forwarding companies include:
– Ocean freight forwarders / NVOC
– Air freight forwarder / air cargo agent
– Customs Agent
– Road haulier – Trucking
– In transit warehousing / Depot Opeartors
– Packing / Consolidating

Forwarder companies require Freight Forwarder liability insurance for several reasons:

Care custody and control
The shipping company is fully responsible for third party goods (cargo) that are under their care and control (care, custody and control) so that they are safe and secure to their destination.

Involving many parties
Transporting goods from one location to another throughout Indonesia (domestic) and around the world (international) involves many parties, ranging from the owner of the goods, sub-contractors, land transport, loading and unloading workers, ports, shipping parties, customs – excise duty, and other third parties. If a claim occurs, who is responsible?

High claim frequency
Claims may arise from a contract of carriage, bill of lading or airway bill, warehousing contract, or other third party legal liability that may arise from an accident of carriage. In a Freight Forwarder Liability policy, there are usually so many claims, both small and large. You can read articles related to the risk of importing goods from China in this blog “Be careful handling imports of goods from China”.

High defense costs
Proven responsibility or not, if a problem occurs in court, it requires a large amount of defense costs. Therefore, there needs to be a guarantee for the cost of the defense / defense cost so that all risks of lawsuits can be transferred to other parties.

Because of these four things, we should both agree that Freight Forwarder Liability insurance is really needed.

Regarding the risks covered in the Freight Forwarder Liability, will be explained on the next page.

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