An SME that does not carry goods itself has one decisive question to answer: at what moment does the risk in the goods pass to your customer, and at what moment does it pass from your supplier to you.
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In brief
Anyone who delivers or purchases insures not journeys but moments. Your sales and purchase terms, or the delivery term used, determine how far you bear the risk. If you deliver to the door, the consignment travels at your expense as far as the customer's door. If you buy ex works, the risk is yours from the loading bay. That is the boundary you have to insure, whoever's lorry turns up for it.
Then comes the form. If you dispatch continuously, an annual policy on which you declare the volume carried and which is adjusted afterwards is suitable. For a single valuable consignment, separate cover for that journey is more logical. With an open policy the risk lies not in the annual value but in the maximum per consignment: anything that exceeds that limit in one go travels partly uninsured.
The declaration itself is not a formality. If your sales area changes, you suddenly start dispatching outside Europe or the average consignment value doubles, that has to be passed on. Articles 7:928 and 7:930 DCC attach consequences to it: with an incorrect or outdated declaration the payment can be reduced. See also the goods in transit insurance.
The structure of the cover in three parts, with an overview per situation below.
The basis
Actual value
What the cargo is actually worth.
Not capped per kilogram
Regardless of who is liable
Including freight and costs
The difference
Liability
What a carrier bears at most.
CMR: 8.33 SDR per kilo
AVC: € 3.40 per kilo
Rarely the actual value
Optional
Type of cover
From limited to all risks.
All external perils
Limited perils
Storage in transit
What is covered
Situation
Carriers' liability
Goods in transit
Damage from an accident, up to the weight limit
Yes
Yes
Damage above the weight limit
No
Yes
Theft of the cargo
Sometimes
Yes
Damage with no identifiable fault
No
Yes
Storage during the journey
No
Sometimes
Inherent defect or inadequate packaging
No
No
This overview is general in nature and is not personal advice. What is actually covered, including exclusions, limits and the excess, is set out in the policy conditions and the insurance card (verzekeringskaart) of the insurer; you receive both before you take out cover. Taking out cover without advice? Then read what execution only means for you.
Where things go wrong in practice
Four points that make the difference between a policy that pays out and one that does not.
Your terms of delivery determine what you have to insure
The passing of ownership and the passing of risk are two different moments and rarely coincide. You can have retention of title until the invoice is paid, while the transit risk already lies with your customer. So set side by side what your terms say and what you have actually insured. If they do not match, you are paying premium for a risk someone else bears, or the other way round, and that only comes to light when you claim.
Incoming consignments are forgotten most often
Most business owners think of transport as what goes out of the door. The pain more often lies in what comes in: raw materials paid for in advance, machine parts, a replacement component from abroad. Your supplier often insured those only up to a certain point in the chain. If the consignment disappears after that, you have lost both the money and the delivery time, and a transit policy does not pay for that downtime.
The limit per means of transport is the real ceiling
An open policy names a maximum for what may be in one vehicle, container or consignment. As long as you send small orders daily, that goes unnoticed. If you bundle orders for a trade fair week, a project delivery or a holiday shutdown, a multiple of the usual value suddenly goes in one journey. Test those peaks in advance and declare them. Afterwards, payment is made proportionately and you bear the rest.
What a transit policy does not solve
Business interruption because a delivery fails to arrive, contractual penalties for late delivery and lost margin fall outside the cover. The same applies to inherent defect, unsound packing and storage with a third party that you did not declare. If you also want to cover downtime, that is a business interruption question and not a transit question. Those two policies rarely connect of their own accord.
What does your premium depend on?
Declared annual volume. The total value on the road at your risk in a year is the basis on which an open policy is calculated and adjusted.
Maximum value per consignment. The highest value that can be in one vehicle or container determines the limit and thereby much of the rate.
Balance of incoming and outgoing. Whether you mainly dispatch yourself or buy a great deal changes the risk profile and where in the chain you need cover.
Destinations and countries of origin. Domestic deliveries, dispatch within Europe or overseas purchasing lead to different assessments of transit and theft risk.
Carriers engaged. Whether you work with fixed hauliers, with parcel and courier services or with different parties per job counts in the underwriting and premium.
Storage on the way and excess. Interim storage with a freight forwarder or distribution centre and the excess chosen together determine the eventual pricing.
Insurers weigh these details differently. That is where your saving is.
How we arrange it
You request a quoteWe take stock of your activities, turnover and wishes.
We compareseveral insurers, on premium as well as conditions.
You receive a proposalWith an explanation of the differences and the exclusions.
We arrange the switchIncluding cancellation, so there is no gap in cover.
Customers rate our service on four aspects: personal service, service delivery, availability and the outcome. The reviews are collected and published by NH1816 and come from customers who have actually taken out a policy with Finass Advies B.V. or reported a claim.
Yes, because delivery to the door means the consignment travels at your expense as far as the customer. If something goes wrong on the way, your customer has received nothing and you have to deliver again or issue a credit note. If you deliver ex works, the risk is the buyer's from loading. Check which term appears in your terms and on your quotations.
Are consignments I buy covered as well?
Only if that has been agreed. Many policies are limited to outgoing consignments, while purchasing is precisely where the gap arises: you paid in advance and the supplier often insured only part of the journey. State when taking out the policy which part of your purchasing travels at your risk and from which point in the chain that starts.
What if one journey exceeds the limit per consignment?
Then there is underinsurance for that carriage and payment is made proportionately. You bear the excess yourself. The limit applies per vehicle or container, not per order. If you expect a peak because of a project delivery or a bundled dispatch, declare it in advance. A temporary increase for that one journey is usually easy to arrange.
An open policy or cover per consignment?
If you dispatch or receive regularly, an open policy with declarations and adjustment is more work but cheaper per consignment, and it also covers the journeys you forget to declare. For a single exceptionally valuable consignment, separate cover is enough. The choice depends on frequency and on the spread in consignment values.
Finass Verzekert is a trading name of Finass Advies B.V. We advise on and arrange non-life insurance on the basis of an objective analysis of several insurers, and receive commission for this from the insurer, which is included in the premium. You pay no separate advice fee. Before you take out cover, we establish your wishes and needs.
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