• Do you have the right insurance product?
- The majority of GIT policies in the market are for carriers of TP goods, whilst in their care/custody/control.
- For these policies to perform, there has to be clear contractual transfer of “risk” or “liability” from the cargo owner, down the line through the various agents/transport brokers, to the eventual carrier (Insured)
- In the absence of any contract or agreement, a carrier may still be held liable due to their negligence
- Carriers who operate under a strict set of “Conditions of Carriage” where they specifically exclude their risk/liability (in other words at “Owners Risk) need a specialist Liability product or Carriers Legal Liability policy
• What are some of the GIT pitfalls to look out for?
- What fleet management and telematics systems do the carrier employ to monitor and secure their vehicles? Not all systems actively monitor vehicle movements and sometimes only act as backup or stolen vehicle recovery units that are activated after an incident has occurred. The transporter should always know where their vehicles are, and where possible, what commodities are being carried on each vehicle, in order to manage the security risks
- What vehicles are the carrier operating? This may seem like a fairly innocuous question, but newer more modern vehicles are generally fitted with modern technology which not only make them easier to track and manage, but also safer to drive. Also, bearing in mind legally all heavy goods vehicles should be restricted to 80km/h.
- Which areas do you operate in? South Africa has many serious socio-economic and infrastructural problems. Nearly half the capable work-force are unemployed and poverty is a huge problem. The road infrastructure has badly deteriorated and effective crime prevention and policing is sorely lacking. All these things contribute to an environment where the simple act of moving goods from A to B become seriously high risk. Knowing where these areas are and taking the necessary steps to avoid them are crucial for a transporter to manage their risk, e.g. limiting operations to daylight hours, or ensuring adequate safe stops are along operational routes.
- Who are your major customers and what commodities are you transporting for them? Nowadays virtually all goods could be considered “high-risk” due to the high values often assigned to commodities. However, certain commodities are simply higher risk than others. If a transporter actively engages in contracts where they will be carrying very high risk commodities, many of which are automatically excluded under most policies, e.g. Fast Moving Consumer Goods (Groceries, e.g. food, beverages, cleaning products, toiletries; Clothing and Footwear; Pharmaceuticals; Cosmetics), Alcoholic Beverages, Copper/Cobalt in any form, Catalytic Converters, Solar Panels/Inverters/Batteries, Electronic Appliances, Computers, Tablets, Mobile Phones and Tobacco products, then the carrier must ensure these items are declared and cover arranged accordingly.
- How are drivers recruited? Some carriers have their own “in-house” driver training programs, but usually drivers are recruited from outside the organisation. Adequate vetting processes are essential to ensure the correct driver are employed who have the correct credentials, skills and experience. In addition, thorough backgrounds checks should be done to verify drivers are not employed who may pose a security risk.
- Cross-Border work? Some carriers will venture outside RSA, running export loads for large retailers into Africa and then often returning with alternative products to ensure vehicles don’t run empty. Be mindful of both loads outbound and returning to RSA. Carriers who do cross-border work should ideally have the necessary experience running these loads. The return loads can often also be high risk mineral cargo, e.g. Copper/Cobalt. Some carriers also engage in the carriage of “bonded” cargo, where goods are destined for import/export only via South Africa. It is worth noting these loads can be particularly problematic, since SARS will firstly insist that any duties/taxes are paid locally should an incident occur within the borders of RSA. Also, managing damaged goods are tricky, since bonded goods may often not be repaired or sold within RSA.
- Are you a Transport Broker, who sub-contracts loads to different carriers? Having the right (Contingent GIT) product is important. Ensure contracts with sub-contractors are reduced to writing, the risk is transferred and the carrier MUST hold their own GIT policy to cover loss or damage to goods.
- Hazchem Carrier? Carriers of hazardous chemicals (e.g. fuels, lubricants, etc) are often better risks due to the high levels of regulation in that industry, BUT ensure the carriers GIT products are supplemented with a specific Hazchem policy also known as a Pollution Liability policy.
Regional Manager | Hollard Trucking | Western and Eastern Cape
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