Cargo Theft: Insurance Protection for Valuable Shipments

Introduction

Cargo theft isn’t just a “logistics problem” — it’s a balance-sheet problem. One stolen load can wipe out profit on multiple orders, trigger contract penalties, delay production, and damage customer trust.

For UK manufacturers, wholesalers, importers, exporters, and specialist logistics firms, the risk is especially sharp when shipments include high-value or easily resold items: medical devices, electronics, tools, branded retail stock, alcohol, cosmetics, pharmaceuticals, and components.

This guide explains how cargo theft happens, what losses look like in real life, and how the right insurance structure (plus practical controls) can protect valuable shipments end to end.

What counts as “cargo theft”?

Cargo theft is any unlawful taking of goods while they’re in transit or temporarily stored during the journey. It can involve:

• Theft from a parked vehicle (including curtain slashing)

• Theft from a depot, port, or warehouse during cross-docking

• Hijacking or “truck-jacking”

• Fraudulent collection (criminals posing as legitimate carriers)

• Load diversion (goods delivered to the wrong location intentionally)

• Insider theft (collusion with drivers or warehouse staff)

• Cyber-enabled theft (route changes, fake instructions, compromised booking systems)

From an insurance perspective, the key question is usually not “was it theft?” but “was the loss covered under the policy wording, conditions, and security requirements?”

Why valuable shipments are targeted

Criminals go for what’s easy to move, hard to trace, and quick to sell. High-value loads also justify more planning and surveillance.

Common theft drivers include:

• Predictable routes and schedules

• Poor parking choices (unsecured lay-bys, industrial estates overnight)

• Weak documentation controls (easy to fake collection notes)

• Over-reliance on subcontractors without checks

• Inadequate vehicle security (no immobilisers, no tracking)

• Publicly visible branding or product labels

• Social engineering (criminals calling depots pretending to be customers)

If you ship medical technology or specialist equipment, there’s an added issue: stolen goods may re-enter the supply chain, creating safety and compliance risks.

The real cost of a stolen load

The invoice value of the goods is only one part of the loss. Depending on your contracts and operations, cargo theft can trigger:

• Replacement costs and expedited manufacturing

• Rush shipping and overtime

• Contractual penalties and service level failures

• Loss of future orders or delisting by buyers

• Customer compensation and reputational damage

• Disposal costs if recovered goods are contaminated or compromised

• Legal costs and disputes with carriers

• Cashflow strain (especially for SMEs)

Insurance can help, but only if it’s structured to match how you ship, who carries the risk, and what your contracts say.

Which insurance policies can respond to cargo theft?

There isn’t one single “cargo theft policy.” Protection usually comes from a combination of covers, depending on your role in the supply chain.

1) Cargo / Goods in Transit insurance

This is the most direct cover for theft of goods while being transported.

Typically, goods in transit insurance can cover:

• Theft from vehicles

• Theft during loading/unloading

• Loss or damage while in transit

• Sometimes temporary storage during the journey (subject to wording)

Key things to check:

• Basis of cover: “All risks” (broader) vs “named perils” (narrower)

• Territory: UK only vs UK/EU vs worldwide

• Conveyance: Own vehicles, hired vehicles, subcontractors, couriers

• Single vehicle limit: Maximum value per vehicle/load

• Security conditions: Alarm, immobiliser, tracking, overnight garaging

• Unattended vehicle clauses: Often strict time limits and location requirements

If you ship high-value items, the unattended vehicle clause is one of the most common reasons claims get challenged.

2) Marine cargo insurance (for imports/exports)

Despite the name, marine cargo insurance often covers goods moved by sea, air, road, and rail as part of international transit.

It can be structured to cover:

• Warehouse-to-warehouse movements

• Containerised shipments

• Transhipment and port storage (within limits)

For businesses importing components or exporting finished goods, this can be essential — especially where Incoterms place the risk on you for part of the journey.

3) Stock and contents insurance (for storage points)

If theft occurs while goods are stored at your premises (or sometimes at specified third-party storage), this may fall under:

• Business contents/stock cover

• Warehouse insurance

• Commercial combined policies

However, if goods are “in transit” or “in the course of transit,” the property policy may exclude it — which is why aligning transit and property cover is crucial.

4) Freight liability / haulier’s liability (if you’re the carrier)

If you operate vehicles and carry goods for others, you may need:

• Goods in transit (for your own goods)

• Haulier’s liability (for customers’ goods you are responsible for)

These are different. Liability cover responds when you are legally liable under contract or law. It may not pay the full value if your liability is limited.

5) Commercial crime / fidelity (for insider theft)

If theft involves employee dishonesty or collusion, commercial crime insurance may be relevant. Transit policies don’t always cover internal fraud.

6) Cyber insurance (for cyber-enabled theft)

If criminals compromise systems to redirect loads, falsify instructions, or access booking platforms, cyber insurance may help with:

• Incident response

• Forensic investigation

• Business interruption

• Extortion and social engineering (if included)

Cyber won’t replace physical goods by itself, but it can cover the wider costs and help you recover faster.

Understanding Incoterms and “who bears the risk”

A common gap happens when businesses assume “the carrier is responsible” — but contracts and Incoterms may say otherwise.

Incoterms define when risk transfers between buyer and seller. If risk transfers to you earlier than you think, you may need cargo cover even if you don’t physically handle the shipment.

Practical tip: map your most common Incoterms (e.g., EXW, FCA, FOB, CIF, DAP, DDP) against your insurance. If you’re not sure, ask your broker to review typical sales and purchase terms.

Common exclusions and claim pitfalls (and how to avoid them)

Cargo theft claims often hinge on conditions and documentation. Watch for:

• Unattended vehicle exclusions: theft from an unattended vehicle may be excluded unless parked in a locked building or secure compound

• Keys left in vehicle: many policies exclude theft if keys are left in or near the vehicle n- Inadequate security: failure to use tracking, alarms, immobilisers, or specified locks

• High-value goods conditions: additional requirements above a certain value

• Poor carrier vetting: fraudulent collection is sometimes disputed if due diligence wasn’t followed

• Late notification: delays in reporting to police/insurers can cause issues

• Underinsurance: if limits don’t match peak shipment values

A strong claims outcome is often built before the loss happens: clear procedures, evidence, and compliance with policy conditions.

Practical risk controls to reduce cargo theft

Insurers love practical controls because they reduce frequency and severity. They also help you negotiate better terms.

Route and journey planning

• Avoid predictable schedules where possible

• Use secure truck stops and pre-approved parking locations

• Limit overnight stops for high-value loads

• Use two-driver rules for certain routes/values

Vehicle and load security

• Immobilisers, alarms, and anti-jemmy locks

• Trailer locks and seal management

• GPS tracking with geofencing and alerts

• Panic buttons or covert trackers for very high-value loads

Operational controls

• Verify collection instructions via a known contact method

• Use unique collection references and photo ID checks

• Tight control of delivery notes and paperwork

• Segregate duties: the person booking the load shouldn’t be the only approver

Subcontractor and carrier due diligence

• Verify operator licences, insurance, and references

• Use approved carrier lists

• Audit subcontractor security standards

• Confirm who is responsible for theft losses in contracts

Packaging and information security

• Avoid obvious branding on outer packaging

• Use tamper-evident seals

• Limit public visibility of shipment values and contents

• Train staff on social engineering and phishing

How to structure insurance for high-value shipments

If you regularly ship valuable goods, a “standard” goods in transit policy may not be enough. Consider these design points:

• Accurate maximum values: set realistic single-load and annual turnover figures

• High-value thresholds: ensure the policy doesn’t quietly cap items like electronics or medical devices

• Territory alignment: UK-only cover won’t protect EU deliveries

• Conveyance clarity: include own vehicles, hired vehicles, subcontractors, couriers, and air freight if needed

• Temporary storage: cover for cross-docking and short-term storage during transit

• Excess levels: balance premium vs cashflow impact

• Claims handling: check insurer reputation and what evidence they expect

A broker can often negotiate bespoke security conditions that match how you actually operate — rather than forcing you into unrealistic requirements that later cause claim issues.

What to do immediately after a cargo theft

If a theft happens, speed and documentation matter.

1. Ensure safety first (drivers and staff)

2. Call the police and obtain a crime reference number

3. Preserve evidence: photos, CCTV, seals, tracker logs, delivery notes

4. Notify your insurer/broker quickly

5. Contact customers and suppliers with a clear plan for replacement

6. Review security failures and implement immediate corrective actions

If you have tracking, share data promptly — it can increase recovery chances.

Choosing the right broker and insurer

For valuable shipments, you want an insurance partner who understands:

• Your goods and their resale risk

• Your transport model (own fleet vs third-party)

• Contractual risk transfer (Incoterms and customer terms)

• Realistic security measures

• Claims support and evidence requirements

The best outcome is a policy that matches your day-to-day reality — and a process that helps you prove compliance if you ever need to claim.

Frequently asked questions (FAQ)

Does standard business insurance cover cargo theft?

Usually not. Many property policies exclude goods “in transit.” You typically need goods in transit or marine cargo cover.

Is theft from an unattended vehicle covered?

Sometimes, but it depends on strict conditions (time limits, locked vehicle, secure location). Always check the unattended vehicle clause.

What if a subcontractor’s driver steals the goods?

This can be complex. Some transit policies cover theft, but insurers may look closely at due diligence and contract terms. Commercial crime cover may also be relevant.

Do I need cargo insurance if the courier is “responsible”?

Often yes. Carrier liability may be limited and may not cover the full value or consequential losses.

How do I insure very high-value items like medical devices?

You’ll likely need higher single-load limits, specific security requirements (tracking, secure parking), and clear item definitions to avoid sub-limits.

Does cargo insurance cover delays and lost profits?

Not usually. Some policies can include limited additional expenses, but business interruption is typically handled elsewhere. Ask about extensions if delays are a major exposure.

Can insurance cover theft at a port or during transhipment?

Marine cargo policies often can, within warehouse-to-warehouse terms and time limits. Wording matters.

What documents help with a theft claim?

Invoices, packing lists, delivery notes, proof of dispatch, tracker logs, CCTV, police report, and evidence of compliance with security procedures.

Conclusion

Cargo theft is a fast-moving risk — and valuable shipments are a prime target. The strongest protection combines sensible security controls with insurance that matches your contracts, shipment values, and real-world transport practices.

If you regularly move high-value goods, it’s worth reviewing your goods in transit or marine cargo policy now — before a loss forces the issue. A small adjustment to limits, security wording, or conveyance definitions can make the difference between a smooth claim and a painful dispute.