Cargo and Freight Insurance in Canada

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Protect your shipment with insurance for cargo and freight

If you ship goods to your customers, you need cargo insurance in Canada. Ensuring your goods reach customers safely is an important part of business today. Insuring your cargo and freight protects you financially and reassures your customers.

Our commercial insurance experts can help you easily add cargo insurance to your business insurance package to protect your product shipments. Get a quote today with ThinkInsure and save more.

Key takeaways about cargo insurance coverage

Cargo insurance is not mandatory in Canada.
Any company that ships products or goods should have a policy.
Cargo coverage provides financial protection for damage, loss, theft, and more.

What is cargo insurance?

white cargo trucks being loaded for a delivery

Cargo insurance is a product designed for companies that ship goods. It protects you when packages are lost, damaged, or stolen. Based on your shipping needs, you can select different types of cargo insurance (open, specific, single), levels of coverage (all risk, named perils), and plan limits.

Depending on the insurance provider, this coverage may be referred to as:

Cargo transportation
Commercial cargo insurance
Shipping insurance
Parcel insurance

Cargo trailer and van insurance are covered under commercial auto insurance.

Why do you need cargo insurance?

There are a lot of things that could happen to goods in transit. Packages get lost, stolen, or delivered to the wrong location and can get damaged. Companies need cargo insurance to prevent financial loss when these things happen.

You also need cargo insurance to instill confidence in your customers. If you don't guarantee the safe arrival of orders, people will be less likely to trust your company, potentially reducing the number of orders you receive. So, cargo insurance protects your goods and lends credibility to your business.

What types of companies require cargo insurance?

Companies that regularly ship goods to business partners and customers should have cargo insurance.

Cargo brokers
Small business
Shipping companies
Transportation providers
Import and export businesses
Carriers
Online and brick and mortar retailers
Manufacturers
Wholesalers
Logistics and supply chain companies
Food and beverage
Suppliers

What does cargo insurance cover?

white cargo sprinter van making delivery to customer

Cargo insurance covers business against the inherent risks of shipping goods and products. Your policy could protect:

Damage: Products are physically damaged
Loss: The shipment is lost in transit
Theft: Cargo, mail, and package theft is a big issue today. Get reimbursed if your shipment is stolen.
Supply chain disruptions: Protect your shipment if supply chain or shipping issues arise.
Regulatory and compliance issues: Ensure you follow all local and international laws when shipping goods.
Unforeseen events: A transport truck gets in a collision, destroying the shipment. A natural disaster damages an entire shipment. Or a fire breaks out at one of the supply chain depots, destroying products.

Speak with your insurer to clarify what types of protection are included in your policy.

What’s not covered by cargo insurance?

All types of insurance have omissions. Cargo insurance policies do not cover some things. Some of the things insurers will not cover include:

Transportation mode restrictions: Some policies restrict the type of transportation you can use to send your products.
Poor packaging: You will not be covered if damages happen because you did not properly package your goods.
Fragile materials: Some policies will not cover extremely fragile products or materials.
Hazardous materials: Policies do not cover the shipment of chemicals or other hazardous materials.
Defective products: You are not covered if you ship products with proven defects.
Illegal goods: Illegal goods or shipments related to criminal activity are not covered.

Types of cargo insurance policies

Shipping needs vary by business, so do your coverage needs. You may require a comprehensive or a simple cargo insurance solution. Here’s a list of common policies:

All-risk cargo insurance: This is the most comprehensive coverage, including all types of loss and damage.
Named/ specified perils cargo insurance: This covers only the threats to loss or damage listed in your policy.
Open cargo insurance: This plan covers your shipments for a specific time. You can do multiple shipments.
Single cargo insurance covers you on a per-shipment basis. It is ideal for businesses that occasionally send goods.
Contingent cargo insurance: As the name suggests, this plan acts as a contingency for shippers. It’s meant for complex claims between carriers and shippers. It applies when standard cargo insurance falls short, ensuring you’re covered when you need it most.
Total loss only: This policy applies when an entire shipment is lost.
Land cargo insurance: Covers cargo moved by land via trucks and other vehicles. It covers theft, collision damage, and other threats.
Marine cargo insurance: Protects goods transported by sea. This can be extended to cover air transportation.
Air cargo insurance: Covers goods transported by air.

Examples of how cargo insurance works

Example #1: Shipping items to customers

You shipped an art print to a customer. The package arrived bent and torn, and the customer wants a replacement. Your policy could pay to replace the damaged print.

Example #2: You ship a truck of materials to a business partner

You ship a truck full of plastic material to a business partner who uses them to manufacture products. The truck is involved in a collision, and your entire shipment is a total loss. Your policy could pay for the cost of replacing the shipment.

How to get cargo insurance quotes

In a few quick steps, you can get cargo insurance or add it to an existing policy. Our brokers will ensure you get the custom solution to your cargo shipping needs.

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How much does cargo insurance cost?

The cost of cargo insurance can vary greatly based on the weight, frequency, and value of the goods. Premiums are typically set as a percentage of the total value of goods. So, you will need to give your insurer information about the goods you want to cover during shipment, and they will calculate cargo insurance costs.

What factors affect cargo insurance rates?

Cargo insurance rates are affected by many factors, such as policy limits, product type, and plan limits. Here are the top things that will influence your premiums:

The item being shipped: Some items are more expensive to ship than others.
The size of the shipment: How much space the goods take up.
Value of goods: The monetary value of items being shipped.
How often you ship goods: The number of shipments you make.
Policy limits: Limits can range from $100,000 to $1 million.
Your claims history: Previous claims and the size of those losses.
Shipping location and route: The distance between locations and the shipping routes used. Some routes have a higher risk of interruption, damage, or theft.

5 star insurance reviews

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Kevin St Clair

2024-11-28

Betsy was a genuine pleasure to deal with considering the circumstances. Thanks again for all your help

Anthony Gomez

2024-11-27

Today, I want to take a moment to recognize Monica Chan, an exceptional insurance broker who has consistently gone above and beyond in her service to me. Monica's dedication to punctuality and consideration has been truly remarkable. She has always been prompt in responding to my inquiries and has never hesitated to offer her expertise and guidance. With Monica as my broker, I have never once felt worried about anything going wrong. Her proactive approach and attention to detail have provided me with peace of mind, knowing that my insurance needs are well-taken care of. Throughout our interactions, Monica has been incredibly helpful, patiently explaining complex insurance concepts and ensuring that I fully understand my coverage options. I wholeheartedly recommend Monica Chan to anyone seeking an insurance broker who genuinely cares about their clients' best interests. Her commitment to excellence and her willingness to go the extra mile make her an invaluable asset in the insurance industry.

Phyllis Baker

2024-11-20

Absolutely amazing service the broker Todd worked on my quote fast I recommend this company to anyone very professional I’m so glad I called them .. Thank you for your great work

Charles Cameron

2024-11-15

Betsy Bannon has been nothing short of amazing at helping us through the complex process of acquiring business insurance. She quickly understood our needs and expertly guided us to the right solution. From start to finish, she made us feel like her most important client which gave us the confidence that we were in great hands. We highly recommend Betsy!

Jermaine M

2024-11-05

I had a great experience with Patrick Vuong. He went above and beyond to help me update last minute changes to my policy in order to qualify for a government grant. Staying back late and coming in early the next day to help finishes the changes. Very kind and professional!

Mark Gaffney

2024-11-05

Betsy Bannon is a professional extremely friendly and knowledgeable and made my experience wonderful! Highly recommend her for any insurance needs. Mark Gaffney

fabian ward

2024-11-04

Great service! Prompt and very helpful! Thanks to Todd allan for really helping me out!

Stephen Mcfadden

2024-11-01

Great experience working with Sohel Rahman, appreciate his honest and can-do attitude. Highly recommend!

Cargo insurance FAQs

Is cargo insurance mandatory?

Cargo insurance is not legally required in Canada. However, business partners may require it as part of a business agreement. Even though it's not mandatory, it's an invaluable form of protection that can protect you against financial losses.

How much cargo insurance do I need?

The amount of cargo insurance you need depends on what you are shipping. Generally, the higher value of goods, the more coverage you will need. Speak with our commercial brokers to determine the best level of coverage.

Do I still need cargo insurance if the shipping company offers it?

Even if other parties have insurance, its recommended that you still have cargo insurance. This ensures you have adequate protection for your goods while in transit.

Who is responsible for cargo insurance?

The shipper is generally responsible for securing insurance. However, many companies work with carriers and other parties to ensure everyone has adequate coverage.

How do cargo insurance claims work?

Filing a cargo insurance claim follows a similar process to other types of insurance claims. However, there are some key differences as well. Here’s what you need to know:

Your claim type (damage, loss, theft) will affect the claims process.
Document everything. Be as detailed as possible.
Start your claim as soon as possible. Within 24 hours is recommended.
There are time limits on claims - be aware of them.
Insurers may have slightly different claims processing steps.

Protect your shipments with cargo insurance

Compare cargo insurance quotes and find a policy that fits your budget. At ThinkInsure, we’ll help you get affordable rates from the top Canadian insurers.

Call 1-855-550-5515 or request a quote online.

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Cargo Insurance

Save on cargo and freight insurance and protect your products while in transit.