A business transporting goods for another party generally carries liability in tort, contract or bailment of the goods during its time in storage and transit.
Standard cargo insurance, unless endorsed, would not cover movements in their own mode of transportation of goods belonging to third parties.
Carriers protection would usually be applied to goods belonging to a third party. This adequately considers and meets the needs of the transport operator concerning the different degree of control over the goods in their care.
Three main types are available and sometimes presented as one with the insured specifying the sections of protection required. This can be attributed to the fact the carriers (businesses carrying goods for third parties) can operate in varying degrees of circumstances. For example:
- Carrying underwritten and agreed Terms and Conditions of Cartage (including a “consignment note) exempting them from liability (“private Carrier”)
- Carrying goods for a particular Client under agreed Terms and Conditions in which they assume full responsibility for the goods in their care.
- Carrying goods without any written Contract (“Common Carrier”), and
- Domestic Carrier – where the ability to restrict liability is limited by the provisions of the Trade Practices Act.
Each of the above may require differing Marine Cover Policies. Looking at the main types available:
- Carriers Liability – for Carriers only using written Terms and Conditions.
- Nominated Clients/Contracts Insurance – All Risks policies for named contracts only.
- Basic Carriers Goods in Transit/Load – Major perils only plus Optional Extensions – available for all carriers with no restrictions on the type of contract.
- Domestic Removalists, who:
- May need cover formulated around their contract terms in cases where responsibility has been accepted for specified events.
- May require a facility to offer insurance to clients – including considerable admin issues for the insurer and removalist associated with the Financial Services Reform Act. An example would be that of a scenario where the insurer would need to appoint the removalist as an Authorised Representative, with training and monitoring provided as part of the arrangement.