Is Goods in Transit Insurance a Legal Requirement?

8 April 2021

In this post, we’ll explain why you should get a goods in transit insurance policy even though it’s not strictly a legal requirement. We’ll also look at certain other types of haulage insurance that you might consider.

Is Goods in Transit Insurance a Legal Requirement?

No, goods in transit insurance is not a legal requirement. There is nothing in UK law that says that you need goods in transit insurance. However, goods in transit insurance is nonetheless essential.

What is Goods in Transit Insurance?

Goods in transit insurance, or GIT insurance as it is more commonly known, covers the goods you carry for reward from A to B. It is also often referred to as Freight, haulage or hauliers liability insurance. While these terms are largely interchangeable, freight insurance refers to freight which attract freight charges; Goods In Transit just refer to the goods being transported.

GIT insurance will cover you if your goods get destroyed, damaged or stolen in transit. You could also fall victim to severe delays, resulting in losses for your clients and customers.

Goods in transit insurance can cover you for all of these losses – either to the goods themselves, or to your clients and customers if they make a loss as a result of a failed delivery.

Why Do I Need Hauliers Liability Insurance?

As we’ve said, hauliers or freight liability insurance is not a legal requirement. But all the same, no haulage firm should ever operate without comprehensive goods in transit insurance cover.

Why? There are two key reasons:

• Anything can happen on the roads. All it takes is a flash flood, a careless driver, or even a particularly long traffic jam to ruin your day and compromise your consignment. If you lose the goods in transit, or you fail to make your delivery on time, you could be personally liable to cover any losses. Goods in transit insurance, though, can cover you for these losses, meaning you and your fleet can bounce back from any mishap.
• Companies around the world understand that the roads are inherently risky. As such, many companies and authorities may outright refuse to deal with you unless you have a goods in transit policy in place.

So even though goods in transit insurance is not a legal requirement, you’ll find it so hard to do business without it that it might as well be mandatory!

Is Any Type of Haulage Insurance Legally Required?

For the goods being transported the answer is technically no.  If you’re transporting goods across Europe for reward, then you’ll also need to consider CMR insurance. This covers you for many of the same things as a standard goods in transit policy: Loss, theft, destruction of damage to the goods in transit, as well as any losses sustained as a result of severe delays.

If you’re transporting goods across Europe, then you’re legally required to carry a CMR waybill. This essentially acts as a guarantee that the sender and the driver are familiar with their goods’ point of origin, their route, and their destination. The CMR waybill also specifies that, should anything happen to these goods while they’re in transit, then the sender will be liable for any losses or damages.

A CMR waybill is a legal requirement for transporting goods across Europe for reward. But there is no such legal requirement for CMR insurance. However, as is the case with goods in transit insurance, the risks of the road are so great that many may refuse to work with you unless you have a CMR insurance policy in place.

So once again, even if CMR insurance isn’t technically a legal requirement, it might as well be!

Head here to a more detailed guide to CMR insurance, what it covers, and how it differs from goods in transit insurance.

What Other Types of Haulage Insurance Will I Need?

Goods in transit insurance covers your goods. Commercial motor insurance covers your other essential assets: Your drivers and your vehicles. And just as car insurance is a legal requirement for private cars, so commercial motor insurance is a legal requirement for your HGVs and other commercial vehicles.

To operate your fleet with total peace of mind, you’ll need a flexible fleet insurance policy that covers you for everything.

Head here to learn more about our expert haulage insurance, and to get a quote.