Business, Freight News, Logistics

Safer cargo: It’s in your hands, says TT Club expert

[ March 15, 2012   //   ]

A large proportion of insurance claims are the result of deficiencies in operators’ own systems or processes, according to a paper presented by by TT Club director Laurence Jones to the TOC conference. The Club’s director of global risk assessment told the conference on 14 March that 43% of the cost of claims resulting from operational factors and were a result of errors or faults in an operator’s systems or processes. Efficient and well constructed processes could prevent many claims, he added.

“While straight forward theft accounted for 29% of operational claims, poor processes and systems were the biggest culprit. A whole range of substandard practices were in evidence, such as bad stowage and handling; customs fines due to incorrect or late paperwork; poor instruction on management of refrigeration equipment; and wrong release of cargo. All such claims could have been avoided with tighter procedures.”

Analysis of TT Club’s $120m-worth of claims reveals that nearly 80% of incidents resulting in a claim were avoidable and the vast majority involved some form of human error. Mr Jones said: “Relatively small investments in training, and maintenance could bring significant commercial benefits through less disruption to operations, lower insurance premiums and more satisfied customers.”

Some 63% of the total cost (as opposed to the number) of claims were due to operational factors, with maintenance – or lack of it – accounting for a further third; leaving those lacking human intervention, mainly weather related incidents contributing only 4%.

Fires in containerised cargo were mainly due to poor stowage or mis-declaration of goods – all of which are under operators’ or shippers’ control.


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