Marine insurance losses from damaged goods increase amid COVID-19 outbreak: AGCS

The current pandemic situation has impacted the global supply chains in an unprecedented manner and risks to cargo in storage and transit, especially to high-value and temperature-sensitive goods have significantly increased, according to the risk consultants of Allianz Global Corporate & Specialty (AGCS).

Analysis of marine insurance industry losses by AGCS over a five year period reveals that damaged goods, including containers, is already one of the most frequent cause of losses, accounting for more than one in five claims (22 percent), based on more than 230,000 claims.

Many companies are having to shut down operations and are unable to handle cargo because of the COVID-19 outbreak, even though transportation of cargo is still regarded as an essential activity by governments around the world.

“Locked down and unmanned facilities means not only an increased risk of theft and fire to the cargo but also risk of damage to goods due to extended storage periods," said Rahul Khanna, global head of marine risk consulting at AGCS. "Transit disruptions to cargo due to closed borders, delayed customs clearances or simply due to lack of personnel can mean long delays to delivery times or even cargo being abandoned.

"Companies should do all that they possibly can to implement robust planning of cargo shipments and ensure they have back-up plans in place because of the last minute shutdowns we are seeing around the world.”