The Secret Behind Shipping Insurance: Ask a 3PL

A customer called me the other day and asked “…are my goods insured while in the care of a warehouse that is contracted by a 3PL?” I hear this question fairly often, so I thought I’d better clear the air.

Like all logistics questions, this depends on a few key factors.

Behind the Scenes

First off, Under Uniform Commercial Code, (prepare yourself, legal jargon coming) a third-party warehouse logistics company is liable for damages for loss or injury to the goods only when it’s caused by a failure to exercise the same care a reasonably careful person would exercise under similar circumstances.

What does this mean? Well, that many warehouses only carry limited liability insurance for proven negligence. These amounts can vary from $100,000 to $1,000,000 and can be different from state-to-state.

Vetting Warehouses

All questions of legality and liability aside, best practices are to thoroughly vet any potential warehouses. A good facility should have a fire suppression system, comprehensive security inside and outside, and certifications as needed; Customs Bonded, FDA Registered, USDA Permit, Public Health Food – Drug Branch Certified, Organic Certified, Food Grade facility. All warehouses are different!

Additional Security

Want something a little more secure? If you want to make sure your goods have adequate coverage, you could also:

a. Purchase additional limited liability coverage from the warehouse b. Purchase a “floater policy” tailored to your situation from an insurer of your choice, or c. Secure warehouse coverage as part of transportation services with your 3PL

At MoveIt, we offer full coverage premium warehouse insurance through Chubb, an A++ rated international insurance group. In fact, we’ve been providing outsourced warehouse services since 1979.

Want to learn more about insuring your shipment? Request a quote and talk to a MoveIt logistics rep. Our team is well-versed in the ways of insurance and looks forward to keeping your valuable shipments safe.

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Dawson graduated from Iowa State University in 2023 with a Bachelor of Science in Finance and Entrepreneurship and has been involved in various sales roles in his young career. His current work at MoveIt is focused on finding new opportunities to drive business growth. Outside of work he enjoys golf, live music, and supporting the Cyclones with his buddies at games or the local watering hole.