4 Hidden Costs of Stolen Equipment or Cargo
xpensive cargo such as heavy equipment, fleet vehicles and goods for commerce are important assets which must be protected. These goods might be retail merchandise going to and from a distribution center, pharmaceutical drugs, or even medical equipment. Although there are specific insurance products and services which seemingly cover the cost of these thefts along with damage caused by third parties, there are still hidden costs which are not obvious but can very much result in revenue loss for your business.
There are still hidden costs which are not obvious but can very much result in revenue loss for your business”
Not all insurance providers cover every aspect of theft. There are deductibles involved. Some products and properties will no longer be replaced in case theft resulted from owner neglect or when the stolen equipment had resulted due to unauthorized use after an investigation is conducted. Premiums paid for equipment or cargo to be insured will also naturally be increased by your insurance company afterwards. In some cases, your insurance coverage may also be dropped and you will be forced to search for alternatives while being exposed. It will be a challenge to find other insurance providers that are willing to accept you as a client after considering previous issues with unrecovered theft. If they do, expect to pay higher premium prices.
Lost Time and Opportunity
Speaking of insurance, your claim for coverage will be coupled with investigation time from the insurer. This will result in lost time and opportunity as you will spend time gathering documents and collecting proof to prove your cause. This can include, but may not be limited to, speaking with various concerned individuals and agencies involved, possible witnesses, police investigators, and insurance representatives; instead of spending time with more urgent matters relating to your business such as accepting orders or sealing a new business deal.
Expedited Shipping of Replacement Items
In the case of lost cargo such as from distribution centers or freight forwarder goods, all lost materials will need to be replaced. Although your insurance may cover the replacement of such loss, replacing them may need to be expedited which will require you or your employees’ time and additional cost. This can also be categorized under the previous bullet as you may be better off delivering new cargo instead of worrying about lost ones if you don’t have a recovery system in place.
In connection with the previous hidden cost of stolen cargo, it obviously leads to revenue loss. Although the insurance company may cover the cost of the goods, they will not pay for related expenses involved such as additional fuel, expediting fees and overtime costs. Your inability to complete your scope of work without the stolen equipment or goods will have a very real impact on the ability to receive payment from your customers.
According to the National Insurance Crime Bureau or NICB, nearly $1 billion is lost every year due to heavy equipment or cargo theft with about 64% of such losses never recovered due to inadequate prevention measures.
According to the NICB, nearly $1 billion is lost every year due to heavy equipment or cargo theft.”
What Can Be Done About Stolen Equipment
Don’t be a part of the statistics. Protect your equipment, machinery, and cargo with preventative systems that can provide proactive alerting. Consider enhancements to your security – background checks, additional oversight personnel, security camera monitoring, or a GPS tracking system. This solution can track your employees and equipment or products in real time and easily assist in recovering stolen equipment or cargo in case of loss. Take control over your merchandise and Cover Your Assets.