Mumbai Collision a Warning to Shippers

(International Freighting Weekly – Damian Brett)

Make sure you have the right insurance policy, warns lobby group

The vessel collision off the coast of Mumbai has served as a warning to shippers to make sure they have the right insurance policy, according to online shipper forum Shippers’ Voice.

The collision between the 2,100teu MSC Chitra and cargo ship Khalija 3, which resulted in hundreds of containers falling into the sea and closing the Indian ports of Mumbai and Nhava Sheva for several days, will result in insurance claims for various losses.

But many of the shippers making claims are bound to find they won’t be compensated because they have the wrong sort of cover, claims the site.

Shippers’ Voice said: “Many shippers will find that they either do not have insurance cover, or that which they have has, hidden within the small print, exclusion clauses that limit or nullify their claim. Some will be surprised at just how little they can claim, despite the value of the consignment. And those expecting compensation for the indirect costs of delayed or lost cargo will be greatly disappointed and frustrated. There may also be wrangling between the salvers and those to whom the cargo originally belonged – the salvers will expect recompense for their work from someone.” Read more here.

DOT Removes Cargo Insurance Requirement for Most Motor Carriers, Freight Forwarders

(World Trade Interactive)

The Department of Transportation’s Federal Motor Carrier Safety Administration has issued a final rule that, effective March 21, 2011, will eliminate the requirement for most for-hire motor common carriers of property and freight forwarders to maintain cargo insurance in prescribed minimum amounts and file evidence of this insurance with FMCSA. Household goods motor carriers and household goods freight forwarders will continue to be subject to the cargo insurance requirement.

FMCSA states that all BMC-32 endorsements and BMC-34 certificates of insurance that insurers have issued to motor carriers and freight forwarders, except household goods motor carriers and household goods freight forwarders, will expire March 21, 2011. However, insurance companies will not need to cancel any previous FMCSA filings. In addition, FMCSA will not remove the names of insurance companies and the appropriate policy numbers from its Web sites and any other FMCSA distribution methods until March 18, 2013, to facilitate the identification of insurance coverage for claims arising from transportation occurring while the policies were in effect.

Insurance Industry Tackles Cargo Theft

(eyefortransport)

The U.S.-based National Insurance Crime Bureau (NICB) and ISO plan to create a national information sharing system to combat cargo crime. By networking existing databases and adding secure reporting and analytic functions, the new system will enable more efficient, accurate and timely sharing of cargo-theft information between theft victims, their insurers, and law enforcement.

Cargo theft is a multi-billion dollar economic drain that exploits existing gaps in the nation’s information-sharing framework.

Theft victims’ inability to provide timely and accurate information about their losses hampers law enforcement’s ability to conduct an effective investigation. Aside from the immediate loss of merchandise, cargo theft affects insurers and their policyholders through added costs that are ultimately borne by consumers. Furthermore, the indirect costs of cargo theft through supply-chain interruption can jeopardise product safety when goods are taken from a controlled environment and resold to an unsuspecting public. Read more here.