Goods in Transit insurance covers your business for loss or damage to goods while in transit, including loading, temporary storage (up to 96 hours during transit), and items being off loaded at any building or place of storage at the consignee’s premises.
Specific events that are covered include fire, lightning, explosion, collision, derailment and overturning. Comprehensive cover also includes theft.
Businesses that want to protect themselves against losses while transporting raw materials, stock, etc. should consider Goods in Transit insurance. This covers businesses that:
Careful practices, such as protective packaging and mindful selection of carriers, can help reduce the chance or size of loss or damage.
It is in the best interest of those planning to transport high-value items to carefully plan an itinerary that will reduce the number of unnecessary stops and keep packing and unpacking to a minimum.
Your insurance policy will have its own specific list of insured events and exclusions. It is best to check with your insurer or the policy wording to confirm the details of your Goods in Transit insurance policy.
Some commonly covered and not covered items include:
Loss of or damage to whole or part of the property described in the Schedule including tarpaulins and packing material not otherwise insured, owned by the Insured or for which they are legally responsible.
In the course of transit by the means of conveyance or other means incidental thereto and caused by any accident or misfortune (excluding as a result of hi-jacking of the load-carrying vehicle) not otherwise excluded
Comprehensive or restricted cover:
Comprehensive cover generally includes all of the above, as well as theft from forcible or violent entry (or exit) from the vehicle.
There are two options when getting Goods in Transit insurance: Annual Carry and Load Limit. Annual Carry is the total value of goods moved in a calendar year. Load Limit is the maximum value that a vehicle will carry in a single trip.
Annual Carry is the total value of goods that a business transports in a calendar year. For example: A business that makes and delivers jam to retail shops would enter the total value of jam that they deliver per year (including jam, bottles, packaging, etc.).
This value is usually in the forecast financial statements. The business will also have to enter the maximum value that one load will carry in the year (sum insured).
Most businesses select Annual Carry.
Load Limit (not offered on Bi-me) is the highest value that a vehicle will transport. This is usually used by businesses that do not know how much their annual carry is.
For example: An informal trader who buys between R1 000 and R5 000 worth of stock each week at the wholesale market will enter R5 000 as their load limit.
We have decided to not offer Load Limit on Bi-me because only a few people select it, and it is more complicated than Annual Carry.
Theft claims
Fire
Storage
Offloading
Under-insuring: The insurance company will only cover up to the limit (sum insured) that you have entered. Let’s say that you selected a limit of R10 000. Any claims up to R10 000 are covered, but for any claims above R10 000 the insurance company will only pay out R10 000. The rest must be paid by your business.
It is also important to give accurate values when you enter your annual carry (value of goods that you transport in a year) amount. Entering a value that is lower than the true value could mean a lower payout than expected.
Over-insuring: Most businesses believe that it is safer to insure a value that is slightly higher than their expected limit for the year, instead of a value that is lower. If you insure your Goods in Transit for a value higher than you actually transport in a year, you will pay higher premiums than necessary.
Generally, the higher the level of risk that your business is exposed to, the higher the cost of the premium.
The insured will be responsible for the excess applied as per the policy wording and policy unless the claim is resulted from fire, lightening or explosion.
It is best to submit the claim form as soon as possible after a loss to ensure that there are no delays or issues, some insurers may request reasons as to why there was a delay in claiming if a form is submitted after 30 days from the date of loss.
The obvious factors are your selected sections and amount of cover – more protection means higher premiums. Other major factors include occupation, address and claims history. If other businesses in your occupation or area have had lots of losses in the past, premiums will generally be higher.
If your business has had lots of losses in the past, your premiums will usually be higher. It is very important to be honest when disclosing all of your information – if an insurer finds that you were dishonest, you may not be covered when you have a claim.
