subject: Do You Need Courier Insurance? [print this page] Courier insurance is a type of insurance that covers individuals or businesses that deliver items. Businesses that hire employees to make any type of delivery may need to insure their drivers with this form of insurance.
If you receive a fee for the delivery of the product or item, special insurance may be necessary. In addition, individuals who are self employed, who freelance or who contract with larger companies to deliver items may need to look into purchasing this specialty insurance in order to protect them against liability in case of a loss.
What kinds of deliveries constitute a courier service?
Individuals and businesses can qualify as a courier. There are various types of deliveries such as mail service, newspaper delivery, package delivery, magazine delivery, medical sample delivery, business and legal document delivery. A person picks up the item from one place then transports it to another. The driver typically gives it to the recipient and has them sign proof of receipt. The service is then billed to the customer. However, there are many things that could go wrong from point A to point B. The item can be lost or stolen. The driver can get into an accident or the item that is to be delivered could be damaged. In such cases the delivery service or courier may be responsible for the cost of the item and possibly additional penalties.
How does insurance help allay costs?
If something happens to the items that are being delivered while in your possession you may have financial liability. You may simply need to pay for the cost of the item that was lost, stolen or damaged. However, in some cases you may also have liability exposure for additional damages. For example, in the case of private, confidential information that is lost and then publicised there may be damage to the client who in turn may seek to recover such damage from the courier service that was entrusted with the item. Courier insurance can cover this amount and pay for the settlement instead of having to pay for it out of pocket.
Doesn't auto insurance cover merchandise in the vehicle?
Some auto insurance policies will cover contents of the vehicle up to a certain point. Others do not pay for it at all. Some policies place restrictions on what is covered and if it is deemed you are a courier and the items you are seeking recovery on are part of your courier service they will not be covered under a typical auto policy. While it is not always necessary for couriers to carry special insurance, in some cases it is advisable.
When should I consider special insurance for couriers?
In order to determine whether or not you actually need courier insurance you need to analyse your risk. If you deliver low value items that you can afford to pay for if something happens, you may want to gamble on the odds of you not ever losing or damaging the item. Even if you do, your out of pocket expenses may not be too great. However, for those who deliver high value items or those where the financial liability may be great if there is a loss, specialty insurance is a necessary cost of doing business.
by: Neil Anderson
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