In the case of damage occurred in the course of the transport of goods, the owner of the goods is entitled to raise a claim against the carrier. The Customer is not required to separately pay for the liability of the carrier, as it is included in the transport price. There are four types of insurance related to logistics.
Freight forwarder’s liability insurance
The general terms and conditions of the Estonian Logistics and Freight Forwarding Association apply. The freight forwarder reimburses the damage to the Customer to the extent that relates to the agreed type of transport. The liability of the freight forwarder as a mediator is limited to 50,000 SDR per contract. SDR (Special Drawing Rights) is a currency used by the International Monetary Fund (IMF). The reimbursement paid by the freight forwarder in the case of road transport shall not exceed:
- the amount of freight fees agreed upon in the contract or other amount of reimbursement in the case of a delay in the delivery of goods;
- for delays, depreciation in the value of or damage to goods the freight forwarder’s liability is limited to SDR 8.33 per kilo of gross weight for the part of the goods that have been lost or damaged or depreciated in value.
Carrier’s liability insurance
This insurance depends on the type of transport. National road transport is subject to the Law of Obligations Act, while international road transport is subject to the CMR Convention.
In road transport, the carrier’s liability is limited to SDR 8.33 per kilo of gross weight (CMR Insurance).
In air transport, EU legislation shall apply and the carrier’s liability in air transport is limited to a maximum of SDR 22 per kilo of gross weight (AWB Insurance).
In sea transport, the Merchant Shipping Act applies. In sea transport, the carrier’s liability is limited to SDR 2 per kilo of gross weight or SDR 666.67 SDR per unit (B/L Insurance).
Cargo insurance or property insurance of transported goods
The first three types of insurance are arranged by the service provider against the risks related to the activities thereof. However, these liabilities are financially limited and in some cases precluded. Cargo insurance ensures full compensation of damage.
Cargo insurance is the additional voluntary insurance of goods that unlike the carrier’s limited liability covers all possible damage to goods during transport. Only cargo that is transported by means of transport or equipment which correspond to the technical requirements for the transport of goods can be insured. It is possible to enter into an insurance contract for a single cargo insurance contract, i.e. an insurance policy, or into a long-term contract, i.e. an open policy for the transport of several cargoes. As a rule, such a policy is entered into for one year. It is possible to insure the cargo against all risks or against a certain type of risk.
The insurance contract is entered into in accordance with the internationally recognised clauses developed by the Institute of London Underwriters (Institute Cargo Clauses – ICC). At the request of the Customer, we will draw up the additional insurance of goods on behalf of the Customer. Our insurance partner in Estonia is the highly respected insurance company ERGO Insurance SE.