Freight Insurance policy will protect cargo if it is damaged or lost while in transit from the shipper to consignee. Purpose of such policy is to provide the insured party or individual with reimbursement of the cargo that is not arrived safely to its destination. Cargo insurance policies can apply to air, marine, or land shipments and cover an extensive list of products such as automobiles, computer equipment, hydraulic equipment, pharmaceutical products and even household goods.
There are two major categories of Cargo insurance:
1. All Risk which covers damages from physical, external cause including partial damage, catastrophe and theft.
2. Total Loss which covers total loss catastrophe of an entire shipment.
Above coverage can be purchased on a shipment-by-shipment basis or on an annual policy for a year round.