Standalone Freight Liability vs Commercial Combined (UK): What to Choose

Introduction

If you move, store, arrange, or handle other people’s goods, you’re exposed to a very specific kind of risk: being held responsible when cargo is lost, damaged, delayed, or misdelivered. Many businesses assume their “business insurance” or a commercial combined policy automatically protects them. Sometimes it helps, but often it doesn’t respond in the way you expect—especially when the claim is based on contractual liability or international carriage rules.

This guide explains the difference between standalone freight liability insurance and commercial combined insurance, how they interact, and how to decide what’s right for your operation.

Quick definitions (plain English)

• Standalone freight liability insurance: A specialist policy designed to cover your legal liability for loss or damage to goods you’re carrying, handling, storing, or arranging—depending on your role (haulier, freight forwarder, courier, warehouse, logistics provider).

• Commercial combined insurance: A packaged policy that typically bundles core covers like property (buildings/contents), business interruption, employers’ liability, public/products liability, and sometimes additional sections (money, goods in transit, legal expenses, cyber add-ons).

The key point: commercial combined is broad “business protection.” Freight liability is narrow but deep “cargo responsibility protection.”

Why this comparison matters

In the real world, logistics claims rarely stay neat:

• A pallet is damaged in transit and the customer alleges poor securing.

• A delivery is late and triggers a contractual penalty.

• Goods are stolen from a yard overnight.

• A subcontractor causes damage but your contract says you’re still responsible.

• Temperature-controlled goods spoil due to equipment failure.

A commercial combined policy may respond to some parts (e.g., property damage at your premises, third-party injury, employers’ liability). But the cargo claim itself often needs a freight liability-style policy to avoid painful gaps.

What standalone freight liability typically covers

Standalone freight liability is designed around your legal liability as a carrier/bailee/forwarder. Cover varies by trade, but commonly includes:

1) Liability for loss or damage to goods

If you are legally liable for goods that are:

• In your vehicle

• In your care, custody or control

• Temporarily stored

• Being loaded/unloaded

2) Liability under standard trading conditions

Many policies are written to match:

• RHA Conditions of Carriage (for hauliers)

• BIFA Terms (for freight forwarders)

• Courier/parcel standard terms

This matters because insurers often want your contracts to be aligned with recognised conditions, limiting your exposure.

3) Optional extensions (depending on your operation)

You may be able to add:

• Temperature-controlled goods (refrigeration breakdown, incorrect temperature)

• Theft from unattended vehicles (subject to security requirements)

• High-value goods (electronics, alcohol, pharmaceuticals)

• Cross-trade / international movements

• Errors & omissions (for forwarders arranging carriage)

• Warehousekeepers liability (if you store goods)

4) Legal costs and claims handling

Specialist freight liability policies usually include:

• Defence costs

• Claims investigation

• Negotiation support

That expertise can be as valuable as the indemnity.

What standalone freight liability usually does NOT cover (common exclusions)

Exact wording varies, but typical limitations include:

• Contractual liability beyond standard terms (e.g., you agreed to “full value” liability)

• Delay-only claims (unless specifically covered)

• Consequential loss (lost profits, penalties) unless endorsed

• Inherent vice (goods deteriorating due to their nature)

• Inadequate packaging (especially if packaging was your responsibility)

• Wear and tear / gradual deterioration

• Unattended vehicle theft if security conditions weren’t met

• Dishonesty by owners/directors (sometimes employees too)

• War/terrorism (often separate)

What commercial combined typically covers

Commercial combined is usually the backbone of a UK SME insurance programme. It commonly includes:

1) Employers’ liability (EL)

A legal requirement if you employ staff (with limited exceptions). Covers injury/illness claims from employees.

2) Public liability (PL) and products liability

Covers injury or property damage to third parties arising from your business activities.

3) Property: buildings, contents, stock

Covers your own assets at your premises (subject to sums insured, perils, security, and conditions).

4) Business interruption (BI)

Covers loss of gross profit/turnover following an insured property damage event.

5) Optional sections

Depending on insurer and trade:

• Money

• Goods in transit (often limited)

• Legal expenses

• Personal accident

• Breakdown

• Cyber add-ons

The big misunderstanding: “Goods in Transit” vs “Freight Liability”

Commercial combined policies sometimes include goods in transit. But that usually covers your own goods (or goods you’ve sold) while being transported.

Freight liability is different: it covers other people’s goods when you’re responsible for them.

A simple way to remember it:

• Goods in transit = “my stuff moving.”

• Freight liability = “their stuff in my care.”

If you’re a haulier, courier, or logistics provider, the second one is often the bigger exposure.

Side-by-side comparison (at a glance)

Which businesses need standalone freight liability?

Standalone freight liability is commonly essential if you:

• Carry goods for hire and reward (haulier)

• Operate as a courier/parcel carrier

• Arrange carriage as a freight forwarder

• Provide 3PL/fulfilment services

• Store goods as a warehousekeeper

• Handle goods during loading/unloading

Even if you subcontract transport, you may still need cover if your contract makes you responsible.

When commercial combined may be enough (and when it isn’t)

Commercial combined can be “enough” only if:

• You rarely handle customers’ goods, and

• Your contracts clearly limit your responsibility, and

• Any goods exposure is minor and covered by a correctly structured extension.

But if goods are central to your service, relying on commercial combined alone is risky.

Real-world scenarios: how claims can fall into gaps

Scenario 1: Damaged pallet during unloading

A forklift punctures a crate. The customer claims for the damaged goods.

• Commercial combined PL might respond if the claim is framed as third-party property damage.

• But insurers may argue the goods were in your care, custody, or control, which can be excluded under PL.

• Freight liability/warehousekeepers is designed for this.

Scenario 2: Theft from an unattended vehicle

A van is stolen overnight.

• A freight liability policy may cover the cargo if security conditions were met (alarm/immobiliser, locked compound, no overnight parking in certain areas, etc.).

• A commercial combined policy may not respond at all to the customer’s cargo claim.

Scenario 3: Contractual “full value” liability

You sign a client contract agreeing to replace goods at full invoice value, regardless of standard terms.

• A freight liability policy may exclude liability you assumed beyond standard conditions.

• This is where contract review and correct policy wording matter.

Scenario 4: Refrigerated goods spoil

A reefer unit fails and food spoils.

• Standard freight liability may not include temperature-controlled extensions.

• Commercial combined won’t usually cover the customer’s goods.

Key buying factors (what to check before choosing)

1) Your role in the chain

Are you a:

• Carrier/haulier?

• Freight forwarder (arranging carriage)?

• Warehouse/3PL?

Your role determines the correct liability basis and policy type.

2) Trading conditions and contracts

Insurers will want to know:

• Which terms you trade under (RHA, BIFA, bespoke)

• Whether you ever accept higher liability

• Whether you use subcontractors and how liability is passed down

3) Maximum value any one vehicle/consignment

Be clear on:

• Highest single load value

• Typical load value

• Any high-value peaks (seasonal, special projects)

Underestimating this is a common cause of underinsurance.

4) Territory and international exposure

UK-only is simpler. If you do:

• EU movements

• Worldwide forwarding

• Cross-trade

…you need a policy built for that territory and legal framework.

5) Security and risk management

Expect questions on:

• Vehicle security (tracker, immobiliser)

• Overnight parking arrangements

• Driver procedures

• Warehouse alarms/CCTV

• Key control

Security conditions can make or break a theft claim.

6) Claims history and goods type

High-risk goods (alcohol, tobacco, electronics, pharmaceuticals) can change pricing and terms.

The best approach for many logistics firms: combine both (properly)

For a lot of UK logistics businesses, the most robust setup is:

• Commercial combined to protect the business (EL, PL, property, BI)

• Standalone freight liability (and/or warehousekeepers liability) to protect the goods exposure

This avoids forcing one policy to do a job it wasn’t designed for.

Common add-ons worth considering

Depending on your operation:

• Motor fleet / commercial vehicle insurance (separate from combined)

• Tools and equipment (if you operate mobile)

• Cyber insurance (logistics firms are targets due to payment fraud and supply chain disruption)

• Management liability / D&O (if you have directors and complex contracts)

• Legal expenses (for contract disputes and employment issues)

Questions to ask your broker (use this checklist)

• What is the policy basis of cover: RHA/BIFA/other?

• Is cover per vehicle, per consignment, and what are the limits?

• Are theft conditions clearly stated, and can we meet them?

• Does the policy cover loading/unloading and temporary storage?

• Are subcontractors covered, and how is liability handled?

• Are temperature-controlled or high-value goods included?

• Are delay and consequential loss excluded?

• Does our commercial combined PL exclude “care, custody, or control”?

• Do we need warehousekeepers liability as well?

FAQs

Is freight liability insurance the same as goods in transit?

Not usually. Goods in transit often covers your own goods. Freight liability covers your legal liability for customers’ goods.

I’m a freight forwarder—do I need freight liability or something else?

Forwarders often need a policy that includes forwarders liability (including errors & omissions) and aligns with BIFA terms.

Can I just add a “goods in transit” section to my commercial combined?

Sometimes, but it may not cover your liability for third-party goods, and limits/conditions can be restrictive. It’s worth checking wording carefully.

Does public liability cover customers’ goods?

Often not, due to “care, custody, or control” exclusions. Specialist liability for goods is usually the safer route.

What limit should I choose?

Base it on the maximum value you could be responsible for at any one time (single load/vehicle, or stored goods), plus any contractual requirements.

What about subcontracted hauliers?

You may still be responsible to the customer. Ensure your contracts pass liability down and that subcontractors carry adequate cover.

Conclusion

Commercial combined insurance is excellent for protecting the day-to-day foundations of your business—premises, people, and general liabilities. But if you handle other people’s goods, standalone freight liability is often the policy that prevents a single cargo incident from becoming a business-threatening loss.

If you want a clean, confident insurance programme, start by mapping your role (carrier, forwarder, warehouse), your contract terms, and your maximum exposure per load. Then structure commercial combined and freight liability so they work together—without overlap confusion or dangerous gaps.