Cargo Theft Trends:

• Cyber Fraud & Fake Brokers: Criminals impersonate legitimate carriers, stealing shipments through digital deception.
• Warehouse & Distribution Center Heists: High-value goods are increasingly targeted before they even hit the road.
• Porch Piracy & Last-Mile Theft: E-commerce retailers are losing millions to stolen packages during final delivery.

Compounding the issue, 85% of merchants report that rising demand for same-day and next-day delivery has strained their operations, with 42% experiencing major disruptions.

Given these risks, merchants must take proactive steps to secure their shipments—and cargo insurance is one of the most effective solutions.

What Is Cargo Insurance?

Cargo insurance is a specialized policy designed to protect businesses, merchants, and logistics providers from financial losses due to damage, loss, or theft of goods during transit. It covers a wide range of risks, including accidents, natural disasters, improper handling, and criminal activities such as cargo theft and freight fraud.

While standard carrier liability provides minimal protection, cargo insurance ensures full compensation for lost or damaged shipments—regardless of who is at fault.

What Does Cargo Insurance Cover?

• Physical Loss or Damage: Covers goods damaged in accidents, natural disasters, or improper handling.
• Cargo Theft & Fraud: Protects against stolen shipments, hijackings, and potentially cyber-enabled freight scams.
• Lost Shipments: Reimburses merchants when shipments go missing in transit.
• Supply Chain Disruptions: Covers delays or losses caused by logistics failures, helping businesses avoid financial setbacks.

Why Cargo Theft Insurance Is a Critical Part of Cargo Coverage

As mentioned earlier, cargo theft is one of the biggest threats to global supply chains costing businesses up to $35 billion annually. With freight fraud, cyber scams, and organized crime syndicates targeting shipments at record rates, merchants must ensure that cargo theft insurance is included in their overall cargo insurance policy.

Who Needs Cargo Insurance?

1. E-commerce retailers shipping high-value goods
2. Wholesalers and manufacturers transporting inventory
3. Third-party logistics (3PL) providers responsible for client cargo
4. Freight brokers managing multiple shipments
5. Any business facing high risks in transit due to theft, damage, or delays

How Cargo Insurance Protects Your Business

Cargo insurance safeguards shipments from a variety of risks, ensuring that businesses remain financially stable even in the face of unexpected losses.

1. Financial Protection Against Theft, Fraud & Damage: If a shipment is stolen, damaged, or lost, cargo insurance ensures you receive full compensation, preventing massive financial setbacks.
2. Coverage for Cyber & Identity Fraud Risks: Many criminals now steal shipments digitally, posing as fake brokers or carriers. Modern policies can cover fraud-related cargo losses caused by deceptive load assignments.
3. Protection Against Supply Chain Disruptions: With 85% of surveyed merchants struggling with fulfillment disruptions due to the rise of same-day and next-day shipping, cargo insurance provides stability, ensuring businesses aren’t left covering losses out-of-pocket. *
4. Peace of Mind for Merchants & Supply Chain Operators: With rising cargo theft, businesses need assurance that their shipments are protected—reducing risk and ensuring business continuity.

How to Choose the Right Cargo Insurance Policy

Not all cargo insurance policies are created equal. When selecting a policy, consider:

• Comprehensive Coverage – Make sure the policy protects against theft, fraud, accidents, lost shipments, and supply chain disruptions.
• High-Payout Limits – Cargo values are increasing. Choose a policy that fully reimburses for stolen or damaged goods.
• Fast & Easy Claims Processing – Delays in claims can disrupt operations. Work with insurers that offer seamless claims handling.
• Cyber & Identity Theft Protection – 75% of consumers cite last-mile delivery failures as a major issue, increasing the risk of lost shipments. Ensure your policy includes fraud-related losses.

Preventing Cargo Theft: Best Practices for Merchants & Shippers

While cargo insurance provides financial protection, businesses should take proactive steps to minimize theft and fraud risks.

• Vet Your Carriers & Brokers Thoroughly – Use multi-layered verification before trusting a new shipping partner.
• Implement GPS Tracking & Secure Warehousing – Ensure shipments are monitored in real time and stored in secure facilities.
• Train Employees to Spot Red Flags – Educate teams on common fraud tactics, from cyber scams to fake load brokering.
• Leverage InsureShield for End-to-End Protection – Add comprehensive cargo insurance along with DeliveryDefense™ technology to secure your business from theft, fraud, and damage.

The Bottom Line: Cargo Insurance Is Essential in 2025

With cargo theft at record highs, rising fulfillment challenges, and supply chain disruptions impacting merchants, cargo insurance is no longer a luxury—it’s a necessity.

InsureShield offers industry-leading cargo insurance solutions, ensuring that businesses never have to pay out-of-pocket for lost, stolen, or damaged shipments.

Protect your business now. Get a customized InsureShield cargo insurance quote today!

* Statistics derived from UPS Capital’s 2025 Last Mile report.