Sam Tucker is the founder and CEO of Carrier Risk Solutions, Inc., an Atlanta, Georgia based transportation risk management startup. Prior to this venture, Sam spent 13 years underwriting trucking and logistics accounts at some of the most well known insurance companies. He holds degrees in Business Economics and Finance/Risk Management as well as multiple professional insurance designations. Carrier Risk Solutions' innovative safety management platform can be found online at www.MySafetyManager.com. Reach Sam by email at STucker@CarrierRiskSolutions.com.
One of my clients recently likened having a cargo theft to cheating on a spouse...your shipper may forgive how you failed to protect their goods, but they never forget what happened!
Even if your relationship survives the incident, it will never be the same again. One very important way to prevent cargo theft is to develop a written theft risk management plan. This plan outlines your policies and procedures regarding:
● Preventing cargo theft from occurring
● Mitigating loss or damage during the theft
● Post event recovery efforts and activities
Just taking the time to develop the plan isn't enough, you also need to communicate the plan to your team members, your management staff, law enforcement and your business partners (if appropriate). Like other aspects of company culture, a focus on safety and security begins at the top of every organization. Securing CLevel management buy in is critical to the success of any program.
If you are shipping high exposure commodities (food, pharmaceuticals, consumer electronics, metals, etc) then you should ensure that your carriers have a written theft management plan that they are able and willing to execute. If you are a intermediary, you should develop a tiered approach to your carrier base and only load high hazard or high value commodities with carriers who are in you top tier. Ideally, these carriers will have been hauling for you for some time, they have a history of providing good service and are responsive to the needs of your clients. More importantly, they have undergone a more rigorous screening process; including verification of their actual cargo insurance language (I suggest CarrierCert www.CarrierCert.com) for this. You have to verify that these top tier carriers have better controls in place than most others, including how the carrier intends to mitigate theft losses.
If you are a motor carrier, then you had better give a great deal of thought as to how you are going to reduce your cargo theft exposure! Remember what I just said about the cheating spouse? You don't want to put yourself in that position!
With proper procedures and plans in place and enforced, your chances of success are much greater. This is one of those perfect ounce of prevention scenarios because the cost of a freight claim doesn't end at the loss payment...what about the vast amounts of time and energy that are wasted in resolving freight claims? Lastly, the damage to your reputation that could result from a cargo theft loss might never be undone!
When we say that we want to reduce your total cost of risk,his is exactly what we mean... Investing some time, energy and money up front will help you avoid becoming a statistic later! Please don't ever jinx yourself by saying something like "it's never happened to us before, so we don't have much exposure to cargo theft". This is a $20 to $30 BILLION problen the USA alone and other countries are dealing with the same issues as well!
We can help you design and implement a cargo theft risk management plan for your company, just give us a call. Please let me know if there is anything that I can ever do to help you! Please check out our website at www.CarrierRiskSolutions.com for more information on our services.