Goods in transit insurance: what it covers and who carries it
Cover for goods while they are being carried, whether the carrier owns them or is moving them for a customer.
Data as at · refreshed by scripts/seed-graph.mjs
In short
- Goods in transit covers property while it is being carried, whether the business owns it or is moving it for a customer.
- A carrier’s liability under its trading conditions is usually narrower than the value of the goods it carries.
- It answers a different question from motor insurance, which covers the vehicle.
Goods in transit is the cover for what is in the back rather than for the vehicle itself. It matters to couriers, removalists, carriers and any business that moves customer property as part of what it sells.
The exposure is easy to underestimate because the goods usually belong to somebody else and never appear on the balance sheet.
Also called: goods in transit, carriers goods, transit cover
Own goods and customer goods
Moving a business’s own stock is a property question: the loss falls on the business. Moving a customer’s goods is a liability question first, because what the business owes is set by its contract with the customer.
Carriers commonly trade on conditions that limit liability, and where those conditions hold, the cover needed is smaller than the value carried. Where they fail, it is not.
Where cover typically narrows
Unattended vehicles, overnight stops, unpacked or inadequately packed goods and particular categories such as electronics and tobacco are the usual restrictions.
Loading and unloading is a further boundary, because damage during handling is not always damage in transit.
What people get wrong about it
The first error is assuming the commercial motor policy covers the load. It generally covers the vehicle and its liability to others, not the cargo.
The second is relying on trading conditions that have never been given to the customer, since a limitation the customer never saw may not bind them.
The third is treating a subcontracted delivery as somebody else’s problem, when the customer’s contract is usually with the business that took the booking.
Questions
- Does my commercial motor policy cover the goods I am carrying?
- Usually not beyond a small limit. Motor cover deals with the vehicle and liability for damage the vehicle causes; goods in transit deals with the load.
- I subcontract deliveries. Whose cover responds?
- It depends on the contracts. The customer usually contracts with the business that accepted the job, which can leave that business answering for a subcontractor’s loss and then pursuing the subcontractor separately.
Occupations that commonly carry it
Ordered by how central this cover is to each occupation in the graph. A pattern in the data, not a statement that any business is required to hold it.
- Removalists — Household and office removals, handling other people’s goods end to end.
- Couriers — Parcel and document delivery, usually as an owner-driver under a principal’s contract.
- Truck operators — Heavy vehicle freight operation, as an owner-driver or a small fleet.
- Livestock transporters — Carriage of livestock, with welfare obligations alongside the freight risk.
- Taxi operators — Licensed point-to-point passenger transport.
- Rideshare drivers — Booked passenger transport through a platform, requiring accreditation in most states.
- Bus and coach operators — Charter, school and route passenger services under an operator accreditation.
- Freight forwarders — Arranging carriage of goods for shippers, usually under trading conditions.
- Warehouse operators — Storage and handling of goods belonging to customers.
- Tow truck operators — Licensed towing and vehicle recovery, moving customer vehicles.
- Delivery riders — Food and small-parcel delivery by bicycle, scooter or motorcycle.
Sources
- Moneysmart (ASIC) — General guidance on business insurance from the regulator’s consumer site. A starting point, not a definition of this cover.