The Five Policies You Need to Protect Your Fleet

The transportation industry runs on reliability. The consequences can ripple far beyond a single shipment when cargo is lost, damaged, or delayed. Without proper coverage, businesses risk financial loss, reputational damage, and loss of key contracts, which can all be detrimental.

This article will explore key insights from Jason McConkey, Director of Transportation Underwriting at Central Insurance, on how the right cargo insurance policies can protect your fleet from unforeseen risks and support your business’ long-term stability.

Real-World Risks: Why You Need Cargo Insurance

Every day, fleet operators encounter challenges that put cargo at risk. Examples include:

Refrigeration Failure

The refrigerated transport industry faces significant challenges, including equipment malfunctions that can lead to cargo spoilage. These incidents result in direct financial losses and affect supply chains, brand reputation, and customer trust. 

Example: A carrier transporting dairy products experiences a mechanical failure in a properly inspected refrigerated trailer. By the time the issue is detected, the entire load has spoiled. Without reefer breakdown coverage, the financial loss falls on the fleet operator. Having the right cargo insurance policy in place protects against these unexpected losses.

Rest Stop Theft

Cargo theft is a major concern in the transportation industry. According to AAA Freight Inc., 23% of all cargo theft incidents in the last year occurred at roadside locations. Thieves look for easy targets, including trucks parked in isolated areas.

Example: A driver hauling a full payload stops at a truck stop for the night. The trailer is broken into overnight, and the driver discovers several pallets missing the next morning.

Accident & Cargo Spills

Cargo spills can lead to substantial cleanup costs and operational disruptions. The Federal Motor Carrier Safety Administration (FMCSA) reports that about 1,300 rollover accidents involving tanker trucks occur each year, many resulting in serious spills.

Example: A truck transporting bulk grain is involved in a highway collision, spilling thousands of pounds of cargo on the roadway. The fleet must cover cleanup costs and compensate the client for lost products. The financial burden could be significant without debris removal coverage. 

Essential Cargo Insurance Coverages

The above list outlines just a few of the risks fleet operators face. Proper cargo insurance helps businesses recover quickly and continue operations without financial setbacks when the unexpected happens.

As McConkey explains, cargo requires a tailored approach, as different goods come with different risks. 

“No two shipments are the same, and neither are the risks they face. Cargo insurance isn’t just about replacing lost goods—it’s about keeping businesses running and maintaining client trust.”

Coverages to consider include: 

1. Motor Truck Cargo Insurance—Motor Truck is the foundation of any cargo insurance program. It can cover financial loss due to loss, theft, or damage of goods in transit.
2. Reefer Breakdown Coverage—specifically designed for refrigerated transport, Reefer Breakdown coverage can provide financial protection if refrigeration equipment failures compromise perishable cargo.
3. Debris Removal Coverage—Debris Removal may cover the cost of cleanup after an accident involving spilled cargo.
4. Earned Freight Coverage—Earned Freight coverage can reimburse lost income when a shipment cannot be delivered due to a covered cause of loss.*
5. Contamination and Spoilage Coverage—this coverage helps mitigate financial loss when cargo cannot be delivered due to contamination or spoilage.

The Central Difference

“Protecting your reputation and doing right by your customers is a critical part of business success,” McConkey says. “Cargo insurance isn’t just about covering financial losses—it’s about preserving business relationships and ensuring seamless operations when things don’t go as planned.”

At Central, we understand the unique challenges faced by fleet operators. Our cargo insurance coverages are tailored to protect your contracts, cargo, and reputation, ensuring that when things go wrong, your business can recover quickly, your reputation remains intact, and your fleet stays on the road.

Find an agent to learn more about how Central’s cargo insurance coverages can better protect your fleet. 

*See policy provisions for details on covered cause of loss.