FNM Vietnam is an international freight forwarder and a multimodal services specialist. Our 10 years of multimodal freight management, and all other transport methods, enables us to precisely understand all what this method is requiring. If a maritime transport between Vietnam and your second place isn’t fast enough, and if an air freight is too costly, multimodal freight should be your ideal compromise. In this article we will detail all the advantages of this method, and when you should ask for it.

1) What is a cargo insurance?

The cargo insurance is covering all losses or material damage that occurred on your shipment during its air, sea or ground freight. Many importers and exporters are thinking that this aspect is handled by the carrier, which is a very common mistake. Furthermore, if you are not handling yourself the insurance, it will be difficult to know if the right insurance and value of your goods have been chosen.

 

1.1) How important is it to insure your goods when importing from Vietnam?

Companies are not realising how common are the damages occurred during the freight. On the factory floor, at the airport or port of departure/arrival, shipments aren’t spared. When such events are occurring, the transport insurance is the only thing that will allow your enterprise to stay above. No compensations can be asked without an insurance.

Partial or total loss can be caused by:

  • Theft
  • Inappropriate loading/unloading or handling during the transport
  • Vehicle accidents, like vessel sinking, a plane crash, a burning, or any other type of catastrophy
  • Rain or sea water exposition
  • Temperature variations

You cannot handle all those risks by yourself, because during the travel, you’re giving the responsibility of your shipment to the carrier, the forwarder and the supplier. In times of problems, you can’t question them.

 

2) How to insure your cargo?

There are numerous methods to insure your cargo. We’re detailing the two most common methods in the next paragraphs.

 

2.1) Ask a transfer under the CIF (Cost, Insurance and Freight) incoterm

By definition, when you’re buying a CIF transfer (which is including the freight of your goods from your supplier’s factory to the port of loading), your shipment is automatically insured. If you’re choosing any other incoterm, you must communicate with your supplier and your freight forwarder to insure your goods, depending on the freight contract chosen.

Of course, you must ask a copy of the insurance contract to the carrier or the forwarder.

 

2.2) Ask your forwarder to buy you a freight insurance

Passing through a forwarder for the insurance of your freight is a guarantee of transparency and control. First, you can ask for an optimal coverage of your goods during the transport in Vietnam, the loading and unloading operations and also during the main transportions (vessel, plane, train, truck…).

 

3) What will be covered by your insurance?

Your insurance will reimburse the value of your goods for all total or partial loss caused by:

  • A sea, air or ground danger
  • Mother nature (Extreme weather conditions, natural catastrophes…)
  • An accident during the transport
  • Inappropriate handlings
  • Act of carelessness or malice
  • Theft or destruction because of a human factor

 

4) How much will cost my cargo insurance?

The price of your insurance is based on the total value of your freight and shipment. The insurance cost is calculated by applying a ratio to the previous base value. This price is brought by the insurance company.

The calculation method is as follow: (freight value + goods’ value) * 2-3% = cost of your insurance.

The percentage is depending on your products’ type.

 

5) Claiming for a refund

If you’re regularly ordering Vietnamese supplies, the probability is high that you will have to do a refund claim at least once. Good news, it’s generally easy to do it and it is usually accepted by the insurance company. Furthermore, you will be quickly compensated.

To obtain a refund, you must be able to prove that the deterioration of your goods occurred when the carrier oversaw them, which means that he is responsible of the damages. The first thing to do is to ensure yourself that there is no harm linked with the transportation when you’re receiving your goods. If there is the least damage, you must quickly declare it to your forwarder, which means ideally in less than 48 hours. To prove it, you must provide:

  • Videos and pictures of the decanting of the container and of the opening of the cartons. It will prove that you’re not liable to the damage occurred on your products

  • A list of the damaged products, the quantity and value of each loss
  • A proof of the value like the pro forma and commercial invoice
  • A proof of the reception of the goods

Depending on the damaged quantity, you will be compensated partially or for the total of your loss. You will probably obtain a refund in the form of a money transfer directly sent on your bank account. Generally, the transfer is done within three weeks after the approval of your request.

Contrariwise, the process may be longer if you’re letting your supplier manage your freight, because he may be unused to handle compensation demands. In numerous cases, the supplier is asking the client to handle it by himself.

3.3) Is intermodal freight more beneficial than multimodal freight?

Intermodal freight is generally used when the multimodal freight isn’t possible, which means that no logistic company can ensure the transfer of your goods from A to Z. Thus, you’re forced to contact several logistic services suppliers.

The price of the intermodal freight is generally higher, because of the number of parties involved. Generally, a carrier will proportionally put higher margins on small services than on big services. Thus, the addition of the quotes from all the different companies will be higher than if one company take care of the whole service.

For all freight needs from and to Vietnam, without regarding if they are multimodal or intermodal, FNM Vietnam is the partner you want. Our experience and our skilled and multilingual teams are the key of a successful freight. Do not hesitate to send us a quote request. We will answer you within 48 hours with a detailed answer and competitive rates.

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