Insurance is a crucial part of any risk management exercise, and project cargo is different from other types of cargo insurance. Project cargo logistics generally carries a much higher weight so limitations under international conventions often exceed its value. Therefore, the forwarder is often labile for the full amount. Cargo insurance is important to the owner, but the forwarder must consider their overall cost.
Under all WIS cargo programmes, the forwarder is protected under a waiver of subrogation clause so there is no recourse against him irrespective of fault. Therefore, we would strongly recommend selling cargo insurance to the shipper. No claims under liability insurance will result in lower premiums and offering cargo insurance has numerous commercial benefits to the forwarder.
There are six main elements you need to consider when preparing for project cargo handling. Here they are..
1) Safety
The use of unsuitable vessels, poor quality or inadequate securing and dunnage, inexperienced personnel, and a lack of detailed planning can all lead to damage or loss of cargo.
2) Roads
Survey your road and routes to determine whether you need a convey car. If transit is over a bridge, you need to know the age and condition, shoulder strength, ground bearing pressure limits, and when it the road was last maintained. Additionally, be on the lookout for power, communication and signal lines as well as the level of traffic congestion. You may encounter dirt roads; therefore, you should consider grade, security and seasonal weather conditions. Drainage, erosion and surface conditions may also cause road transportation issues.
3) Bridges
There are 3 main categories to survey and inspect, these are:
- Deck
- Super-structure
- Sub-structure
Bear in mind construction data (year, weight limitations and type) and signs of settlement on the embankment and sub-structure, as well as gaps/cracks and signs of stress, corrosion, oxidation and fragmentations of cement. Be on the lookout for asphalt patches where applicable. Pre-inspection is a must. If you intend to take pictures of a bridge, remember to wear company clothing and have your identification on you – you never know who will be watching.
4) Ports
Tide plays a major factor at the port. How deep is the water at any given time? Are there any floating cranes in strategic locations, and are there specialized service providers available? What is the storage and laydown, and is there experienced labor?
5) Ships
If you require to charter a ship, consider the draft, experience of crew, availability, and most importantly, the dependability. You should also consider the ballast calculations, third party survey and reviews. Gear failure is common, so a contingency plan is required. Asses the ships gear lifting capacity, stability, and port rotation. Who has agreed the charter part agreement, are there clear roles and responsibilities if something goes wrong? Does the subject matter need to be lifted? Consider RO/RO V Lift on/off. Finally, don’t overlook mooring calculations, availability of lines, buoys bollards and the age of the vessel.
6) Customs Clearance
Who deals with the payment of the duties and customs brokerage? Who clears upon arrival and/or handles pre-clearance? Further consideration has to be undertaken if moving into third world countries; you may have to deal with corruption and/or bribery.
Special thanks to W.E. Cox Claims Group for providing these valuable information.