In many cases you may need to shop around for multiple carriers or a carrier in another jurisdiction, or perhaps the manufacturer simply opts to self-insure because options are limited.
So why do imports and exports present such a challenge?
Unsurprisingly, a primary reason is cost. Many carriers see the expense associated with defending claims abroad (in the case of exports) as too risky. Particularly when dealing with the US, a common destination for many exports.
In the US, liability claims often come with the duty to defend and the added expense of ‘costs in addition’ (i.e. the lawyer’s fees will be in addition to the liability limit). For carriers with limited experience in the US market, those litigation costs can add up quick.
With regard to imports, one of the biggest objections we hear is around goods from the Far East. Many carriers won’t consider Far East imports because testing and labelling practices aren’t as robust or they consider the manufacturing standards to be subpar.
This can be particularly challenging because many importers don’t believe they hold liability for goods imported from the Far East, when in reality they carry all of it. It’s not uncommon for producers in the Far East go in and out of business quickly or change names, and many don’t carry their own insurance. This leaves the importer holding the bag when any liability claims come their way.
At CFC, we’ve identified these gaps in coverage and developed a solution that allows us to help our manufacturing clients with these harder to place risks:
- For exporters, CFC will write 100% of US sales, capped at USD25M for businesses with up to CCY200M in revenue.
- We’re also happy to consider imports from the Far East and China. We just ask that businesses show adequate third-party quality control and have good inspection processes in place.
- We have a particular niche for Amazon and other e-commerce sellers
If you have any questions about how to secure the right kind of coverage for smaller distributors or manufacturers who deal with importing or exporting goods, get in touch with our team.
