Aviation cargo insurance

For more on this part of the insurance industry: 

1. visit our aircraft insurance page for a look at all products in this sector 
2. or focus in on all of the aviation cargo insurance products available on IB Markets! 

What is aviation cargo insurance? 

Aviation cargo insurance is a type of coverage for companies like:  

• freight forwarders 
• logistics firms 
• e-commerce exporters 
• manufacturers that move goods by air 

It covers cargo transported by aircraft, whether through dedicated freighters or in the belly of passenger planes. It usually covers incidents such as: 

• fire or explosion during air transit 
• theft from airport cargo zones 
• damage caused by rough handling or turbulence 
• losses from aircraft accidents 
• spoilage of temperature-sensitive goods 

The UK handled around 2.7 million tonnes of air cargo in 2024, according to the Civil Aviation Authority (CAA). With the high value and volume of goods in transit, insurance is a key part of the air freight sector. 

Why aviation cargo insurance in the UK matters 

If a shipment of high-value electronics was delayed at an airport due to a handling error, it could cause losses worth hundreds of thousands of pounds.  

And if the freight forwarder only had limited liability cover, the business would be left out of pocket. Air cargo insurance could cover the full value of the goods. 

Aviation cargo insurance: industry trends and emerging risks 

More air cargo is being insured due to faster delivery needs and global trade. Digital tracking is also helping insurers reduce errors and price cover better.  

Growing medical shipments now require tailored policies with temperature protection. But brokers should also focus on threats like: 

• theft of high-value goods: organised crime is pushing aviation cargo insurance losses up 
• air traffic control delays: system failures and staff gaps lead to perishable claims 
• carbon limits reduce flights: new emissions rules raise business interruption risks for insurers 

Tech cargo is increasing the risk of in-flight fires, especially from lithium batteries. At the same time, cyberattacks on logistics systems are causing data loss and claims 

Aviation cargo insurance FAQs 

Who should buy aviation cargo insurance? 

Insurance for air cargo is essential for many stakeholders involved in the air transport of goods. These include: 

• freight forwarders 
• importers and exporters 
• manufacturers 
• logistics providers 
• retailers 

Anyone who owns or manages air cargo can benefit from proper aviation cargo insurance. 

What does cargo insurance include? 

Aviation cargo insurance protects goods transported by air against various hazards. Coverage typically includes:  

• physical loss or damage during transit 
• theft  
• fire  
• natural disasters  
• accidents  

Policies can be customised to specific needs, offering either 'all-risk' coverage or 'named perils' coverage. 'All-risk' policies provide broad protection, while 'named perils' policies cover only specified risks.  

What is cargo limit? 

The cargo limit refers to the maximum amount an insurer will pay for a loss. This limit is influenced by factors such as the value of the goods, the nature of the cargo, and underwriting assessments.  

What is not covered in cargo insurance? 

Aviation cargo insurance does not cover every risk. Some losses fall outside standard policy terms and must be checked before shipping. Common exclusions are: 

• inherent vice: goods that spoil or break down on their own 
• improper packaging: items damaged due to poor or careless packing 
• delay: costs linked to late deliveries, even if goods are spoilt 
• war and terrorism: losses from hijacking, attacks, or conflict zones 
• nuclear events: damage from radioactive leaks or explosions 

Every policy is different, so it’s important to read the terms carefully. Businesses may need extra cover for high-risk goods or routes. 

How do I claim cargo insurance? 

Claiming on an aviation cargo insurance policy is simple when the steps below are followed clearly: 

1. tell the insurer straight away: report the loss or damage as soon as it’s found; waiting too long could affect the claim 
2. gather all documents: take photos and collect papers like air waybill, invoice and packing list 
3. fill in the claim form: complete the form provided by the insurer and attach the documents 
4. cooperate with checks: the insurer may ask questions or inspect the goods and respond quickly 
5. wait for the result: if approved, the payout will be made based on the policy terms 

Always check the policy for deadlines and required documents. Each insurer may have slightly different rules. 

Is air cargo insurance worth it? 

Insurance for aviation cargo can be a smart choice for many businesses. It’s often worth it because it: 

• covers high-value losses: helps recover costs when goods are damaged or go missing 
• offers peace of mind: gives confidence that cargo risks are managed 
• meets trade rules: some buyers or countries need proof of insurance before accepting shipments 

For companies shipping regularly or moving valuable items, aviation cargo insurance is often a worthwhile investment.