Risk & cargo insurance

Where does risk sit?

Risk of loss or damage transfers from seller to buyer at the point fixed by your agreed Incoterm — which may be very different from where the cost of carriage ends.

For example, under FOB risk passes once goods are loaded on board at origin, even though the seller may have paid freight onward. Knowing exactly who carries the risk on each leg tells you who needs the insurance. See International Transactions for how Incoterms shape the deal.

Carrier liability is strictly limited

This is the single most misunderstood point in freight. If a carrier loses or damages your goods, their liability is capped by international convention — by weight, not by value:

• Sea — Hague-Visby Rules: roughly 2 SDR per kg or 666.67 SDR per package, whichever is greater.
• Air — Montreal Convention: roughly 22 SDR per kg.
• Road (international) — CMR: roughly 8.33 SDR per kg.

Why all-risk cargo insurance matters

Marine cargo insurance (covering all modes, despite the name) pays the insured value of the goods — typically cost plus freight plus 10% — regardless of which carrier was at fault. It closes the gap between what your cargo is worth and what a carrier would ever pay.

• Covers loss, damage and often general average contributions.
• Faster settlement than fighting a liability claim.
• Essential whenever the goods' value exceeds the convention limits — which is almost always.

How Boabab helps

We flag where risk passes under your Incoterm, quantify your exposure against the carrier liability limits, and arrange all-risk cargo insurance at competitive rates through our network. If the worst happens, your coordinator manages the claim end-to-end.