Why Ocean Cargo or Stock Throughput May Be a Smarter Investment
Businesses that import or export goods face an array of complex logistics challenges. While many companies default to insuring their goods through their freight forwarder, this seemingly convenient option often comes with hidden costs and limitations. If you’re regularly moving high-value or high-volume shipments, understanding the difference between freight forwarder-provided insurance and securing your own stock throughput or ocean cargo insurance policy could save your business thousands of dollars annually.
What Is Freight Forwarder Insurance?
Freight forwarder insurance is coverage offered by the freight forwarding company handling the shipment of your goods. At first glance, it seems like a simple solution—especially when you’re coordinating shipments across countries, carriers, and customs agencies. But here’s what many businesses don’t realize: this convenience often comes at a premium, both financially and in terms of the quality of coverage.
Freight forwarders typically offer insurance as a pass-through service, purchasing a policy from a third-party insurer. And adding a markup to cover their administrative overhead. In some cases, this markup can range from 10% to as much as 30%. That might be acceptable for a one-off shipment, but when scaled across frequent, large, or high-value shipments, the cost adds up quickly.
In addition, policies offered by freight forwarders often provide only limited liability coverage, focusing primarily on the shipment in transit. They may not protect your goods while in storage, in port, or during loading and unloading—key stages where losses can occur. And when a loss does happen, the claims process is often managed through the forwarder, creating a layer of separation between you and the insurer that can lead to delays and disputes.
What Is Stock Throughput or Ocean Cargo Insurance?
By contrast, a stock throughput policy (STP)—also known as an ocean cargo insurance policy when focused solely on marine transit—is a comprehensive form of insurance designed to cover goods throughout the entire supply chain. This includes coverage for raw materials, finished goods in transit, and even items stored in third-party warehouses or distribution centers.
Unlike freight forwarder insurance, a stock throughput policy is tailored to your business. It can cover goods from the moment they leave the manufacturer all the way through delivery to the end customer. It offers seamless coverage across multiple modes of transportation—sea, air, and land—as well as storage points in between. For businesses with complex or recurring logistics needs, this type of policy can significantly reduce gaps in coverage.
Coverage Gaps to Watch Out For
One of the most significant risks of relying on freight forwarder insurance is the potential for coverage gaps. For example:
- Storage isn’t always covered. If your goods sit in a third-party warehouse before being delivered, you may not be protected under a forwarder’s policy.
- Perils like theft, water damage, or improper handling may be excluded or capped at very low limits.
- Slow claims processing is common when a freight forwarder acts as an intermediary.
- Liability limits are often based on weight or a per-shipment cap—not the full value of the goods.
In contrast, a stock throughput policy offers customizable terms. If your goods require temperature control, if you’re shipping to regions with higher risk, or if you have warehouse partnerships in multiple countries, the policy can be tailored accordingly.
When Should You Consider Switching?
If you’re only shipping small volumes infrequently, forwarder insurance might still make sense. But if any of the following applies to you, it’s time to consider your own policy:
- You ship internationally on a regular basis.
- Your shipments exceed $100,000 in value.
- You use multiple freight forwarders or carriers throughout the year.
- Your goods spend time in storage or transfer warehouses.
- You’ve experienced delayed or denied claims through a forwarder.
At that point, it’s not just about saving money—it’s about protecting your supply chain with consistent, reliable coverage that grows with your business.
Why Work With a Specialized Insurance Partner?
Navigating marine and cargo insurance can be complex. That’s why working with an experienced provider like Coughlin Insurance Services is so valuable. With deep knowledge of logistics insurance, marine policies, and international shipping risks, Coughlin’s team can design a custom solution.
You’ll benefit from:
- A policy designed for your cargo, routes, and storage needs
- Wholesale premium access through global insurance markets
- Faster, more efficient claims support
- Ongoing consultation as your business scales
Coughlin doesn’t just sell policies—they become a trusted risk management partner. When your cargo is your livelihood, that’s a relationship worth investing in.
Stop Overpaying for Less Protection
While freight forwarder insurance may seem like the easiest option, it often comes at a high price and low return. By purchasing your own ocean cargo or stock throughput insurance policy, you can reduce costs, close dangerous coverage gaps, and streamline claims.
A Partnership Where Understanding Meets Action
Since 1947, Coughlin Insurance Services has committed its resources to assist distributors, importers, and exporters, ensuring they are protected against the unpredictable nature of the food trade industry. As specialists who understand the nuances and vulnerabilities of the global food distribution network, we have fine-tuned our insurance solutions to cater to this industry’s evolving dynamics. Our affiliations with the Association of Food Industries (AFI), National Frozen & Refrigerated Foods Association (NFRA), and the Peanut And Tree Nut Processors Association (PTNPA), reinforce our commitment to safeguarding your business with unparalleled expertise. We ask you to consider a partnership where understanding meets action.
You may have been recommended to us by one of our many satisfied customers, or you may have searched online for “Ocean Cargo & Stock Throughput Insurance near me.” However you found us, we’re happy to welcome you. To discuss your needs and objectives and how we can help your company, please contact JJ Van Aman, Vice President of Sales email: jj@coughlinis.com or tel: 973-598-5884 or reach out for a free insurance quote today!