As anyone in the marine transportation industry knows, loss of cargo is a common issue that can hurt business and damage bottom lines. Insuring against loss of cargo is vital to success as a shipowner. Also, understanding exactly how and why the cargo was lost is essential to assigning fault and filing an insurance claim.
How is cargo lost? Cargo can be destroyed by fire, sunk, or destroyed by weather events. It can also be lost or stolen. In some cases, cargo can be spoiled due to refrigeration problems or delays. In other cases, it can be mislabeled and misplaced.
Understanding Cargo Accumulation
One of the newest issues faced by the shipping industry today is cargo accumulation: everything is getting bigger. Cargo ships are increasing in size with each passing year. At the same time, storage facilities are becoming larger and more densely packed. In fact, the largest container ship in 1997 carried less than half the cargo of the largest ship on the waters today.
What are the risks of cargo accumulation on these larger ships? Very simply, the opportunity to lose huge amounts of cargo at one time goes up. If there is a fire, for example, 18,000 standard containers could be destroyed at once. As your mother might say, shippers are putting a lot of eggs in one basket.
Properly Insuring Your Cargo
Perhaps the biggest problem with cargo accumulation is that shippers are putting more of their cargo in one place without reassessing their insurance coverage. Many don’t have enough coverage in the event of a widespread loss—losses that can easily occur when so much cargo is in one place.
Marine Insurance Attorneys
Marine insurance issues can be complex. Due to the worsening problem of cargo accumulation, insurance claims can easily reach into the millions. Do you need an experienced marine insurance lawyer at your side? Call the Voss Law Firm today to speak with our team: 888-614-7730.