Contingent Cargo Insurance

Contingent cargo insurance is a specialized policy primarily purchased by freight brokers and third-party logistics companies. It provides backup coverage for freight in transit when the motor carrier's own cargo insurance fails to respond to a claim, whether due to policy exclusions, lapsed coverage, or insufficient limits.

Unlike primary cargo insurance carried by the trucking company, contingent cargo is secondary coverage. It only activates when the carrier's policy does not pay. This makes it a safety net rather than a replacement for proper carrier vetting. Freight brokers use contingent cargo to protect themselves and their shipper clients from financial loss when a carrier's insurance falls short.

For motor carriers, understanding contingent cargo helps explain why brokers verify your insurance so carefully. They need to know your cargo policy is active and adequate because their contingent coverage only kicks in as a last resort. Keeping your cargo insurance current and properly documented makes you a more attractive carrier to brokers and shippers.

Not the Same as Motor Truck Cargo

Motor truck cargo is the carrier's own primary coverage for the freight it hauls. Contingent cargo is the broker's backup, and it may respond only when the carrier's cargo policy does not. See Contingent Cargo Insurance and Motor Truck Cargo side by side.

Example

A broker books a load of electronics with a carrier whose cargo policy excludes theft from an unattended truck. The load is stolen overnight, the carrier's insurer denies the claim, and the broker's contingent cargo policy is where the claim goes next.