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Freight forwarders are an essential part of the supply chain. They act on behalf of exporters and importers and have the responsibility to move goods through long and complex routes that can be both on land, air, and sea.
They have arguably the most difficult task in the average supply chain, and a single mistake can lead to delays and devastating financial losses. For that reason and more, getting your freight forwarder business insured is essential if you want to financially protect your company from claims and lawsuits.
How Much Does Freight Forwarder Insurance Cost?
The cost of freight forwarder insurance will vary from business to business. Generally speaking, the price you’ll pay will depend on a number of factors including the level of coverage you opt-in for and the size of your business.
The average freight forwarding business in the United States pays around $250 per month or $3,000 per year on general liability insurance. This policy will provide your business with cover in case a lawsuit or a claim related to property damage or third-party bodily injuries is filed against your freight forwarding company.
Freight forwarders who also have company vehicles are required by law to take out commercial auto insurance. This insurance will provide enough cover to protect your company's cars, staff, and any third party involved if an accident were to happen. You can expect to pay around $300 per month or $3,600 per year for this policy.
As a freight forwarder - you cannot make any mistakes. But since mistakes are practically inevitable - professional liability insurance will provide you with financial cover in case your business is sued on the basis of malpractice or negligence that leads to delays and other unfortunate events that cost your clients money. You can expect to pay around $120 per month or $1,440 per year for such insurance.
If your freight forwarding business employs any staff - then worker’s compensation insurance will be of a legal requirement. Such a policy costs around $250 per month or $3,000 per year. It will provide financial cover for your staff in case they get sick or injured at their place of work.
What Types of Insurance Do Freight Forwarders Need?
Generally speaking, freight forwarders have multiple insurance policies to choose from. When it comes to the type of insurance you need for your freight forwarding business - that would heavily depend on the size of your company and the level of cover you want to take out.
Please take a further look below to discover the best and most recommended insurance policies for freight forwarders in the United States.
Why Do Freight Forwarders Need Insurance?
Freight forwarders have a duty to arrange and deliver items to their customers. As such, delayed shipments, damaged cargo, or even communication errors can lead to massive financial losses, which can then come to claims and lawsuits.
And without insurance, your freight forwarding business will have to pay compensation, legal fees, and other costs associated with resolving the issue out of pocket.
In other cases - freight forwarders are legally required to take out a certain level of insurance coverage before they are legally allowed to trade and serve the public and other businesses. Insurance is often a legal requirement so that everyone involved is protected.
Whatever the case may be - having freight forwarders insurance will free your business from any financial liabilities, and no matter the accident at hand - when you have an adequate level of cover - your insurance company will cover all the costs associated with the accident.