Insurance in logistics: need or excess?

According to the law, every cargo that is transported must be insured. But this circumstance, in some cases, does not suit both the customer of services, and its performer for a number of objective reasons.

Compulsory insurance entails an automatic increase in the cost of services – the logisticians working in the legal field suffer. Some firms with a dubious reputation are dumped just at the expense of “left” policies issued by an insurance-one-day, but using forms very similar to the official ones from a well-known company.

It is clear that you can write on paper anything, and even controlling bodies (if the car does not cross customs) is unlikely to suspect a dirty trick. True, in the event of a force majeure situation, the cargo owner remains with nothing, and the carrier, although disowning the “partners” trading in unofficial policies, receives a heap of additional problems. In this connection, the natural question arises: is it worth saving a few percent?!

Another problem is related to the overall complication of the process. In cases with non-standard cargoes, difficult minibuses, etc. experts may need time to calculate the cost of the policy – as a result, urgent delivery is delayed, customers are indignant, plants are without raw materials, well, or something like that. Plus, every additional paper is already a complication of the process, which should be simplified as much as possible in the interests of all market participants.

But let’s not overly criticize the need for insurance, but remember the fresh statistics of 2017, according to which Ukraine is on 134 place out of 138 as of highways. On average, 554 accidents occur every day in the country (4 times more than in European countries), the Kiev region is leading, where over half a million road accidents took place in the last decade. In addition, according to UZ information, more than 90% of the rolling stock of our monopolist is worn out.

Add to all the dislike of drivers to pass the medical board officially, because of the terrible queues and bureaucracy. We will receive a statement of an unpleasant fact – insurance in logistics in modern Ukrainian realities is a necessity. But you can reduce its impact on pricing. It is only necessary to approach the developed countries by numbers of statistics of crimes, road accidents, restore road infrastructure, reform medicine, etc. Risks will decrease, and behind them the insurance companies’ rates.