8 Risk Management tips for Asian Transport Operators

In emerging Asia where countries are becoming more litigious, the transport and shipping industry needs to mitigate and manage their risks.

It is certainly true that the larger the freight movement and the larger the chain of transport operators, the greater the risk of loss or damage.

Also, the sheer size of the regional logistics market means that transport operators need to understand their liabilities, protect themselves and offer value added services like cargo insurance to their customers to maintain the reputation of their business.

1. Have the right standard trading conditions

   It is always advisable to seek the assistance of a qualified maritime lawyer to agree on the right trading conditions and the process to offer these trading conditions via offline and online environments.

2. Ensure trading conditions are understood and accepted by customers

   The full terms must be provided prior to concluding any agreement to move freight for offline and online freight movement transactions.

3. Purchase freight liability protection

   Freight liability cover is designed for transport operators for legal liabilities from loss or damage to freight being consigned under approved trading terms.

4. Clearly advise cargo insurance is not included

   It is critical to clearly advise customers that cargo insurance is not included as part of any freight movement transaction.

5. Offer cargo insurance as a risk management mechanism to reduce such liability

   The availability of a web-based marine insurance quoting and issuing system helps transport operators to reduce their liability by offering cargo insurance to their customers.

6. Arrange bespoke solutions for special contracts or increased liabilities

   For any special contract entered into by a transport operator and its customer, the transport operator should contact their insurer to arrange for bespoke coverage solutions.

7. Transfer the risk of subcontractors

   It is always advisable to seek the assistance of a qualified maritime lawyer to agree on the construction of a suitable principal contractor agreement and the process to offer these terms.

8. Seek risk management support from your insurer for heavy lift and over-dimensional freight movements

   Larger and experienced insurance companies offer risk management support to risks they insure.

These risk mitigation tips are designed to foster sustainable growth among transport operators in Asia, the world’s largest logistics market.