Spanish transportation risk on the rise as cover becomes hard to find

The problem is particularly acute for companies that handle goods and artefacts on their way from one country to another. In addition to dealing with all kinds of operational risks, these companies have to meet the demands of clients who wish to be fully compensated for lost or delayed cargo. As a result, it is often difficult for companies to find adequate insurance coverage in the market, experts at a seminar organised by Asociación Española de Gerencia de Riesgos y Seguros (Agers) said. A major factor for this is the complexity of national and international regulations that govern who is liable to pay for damages, the experts said. As companies make use of transport hubs and other strategies to reduce costs and optimise their productivity, apportioning responsibility can be difficult.hideMultiple regulations can apply to a single transport contract and often the courts have not been able to keep up with developments in the industry. “Transport operations are much more complex today than in the past, and some courts do not know anything about the sector,” said Roberto Moriana, responsible for insurance and claims at the Spanish unit of DB Schenker, the transport and logistics group. Matters are more complicated for Spanish companies as the country has passed laws that have increased the liabilities of transport companies. The most important example is a 2009 bill that imposed new rules for contracts involving the transportation of cargo by land. “We've had to renegotiate many of our civil liability policies because of the new rules,” Mr Moriana remarked. Images that have shown container ships and port terminals destroyed by the earthquake and tsunami that hit Japan a couple of weeks ago illustrate the risks that companies face. The recent events in Libya and other North African countries have also created extra problems for transport companies. Mr Moriana told the audience how cargo could not be delivered to one of his company’s clients in Libya due to the armed conflict in the country. On the other hand, he said, his company had to attempt to deliver the goods. Otherwise there is the risk that it could find itself targeted by claims relating to business interruption and other losses. But domestic conditions have increased the risks too, Mr Moriana said. “We have seen many clients trying to save money in packaging,” he noted as an example. Mr Moriana also stressed that very often the damage caused to goods being transported by a company is the result of poor or incomplete information from the client about how to handle the products. In the current market, clients have been making sure that their contract ensures they receive compensation for any damages caused to their products during transportation, he said. Another consequence of the economic crisis is the increase of insurance fraud involving damages caused to cargo. Lourdes Aguanell, the head of transportation and maritime civil responsibility at Chartis Iberia, pointed out that the theft of cargo has been on the rise in Spain too. “We have heard of lorries being kidnapped by thieves dressed like police officials,” she pointed out. “That's something we knew that happened in South America, but now it is taking place in Spain too.” The theft of lorries carrying a few million euros’ worth of cargo usually receives much less attention from the media and the police than robberies of bank branches, she said, even though the values involved in the latter tend to be smaller.

Spanish transportation risk on the rise as cover becomes hard to find

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