Goods-in-Transit Insurance: The Backbone of a Reliable Logistics Operation

A delivery van can leave the depot with paid-for stock, signed invoices, and a full route, then lose thousands of rand before lunch because one crate falls, a lock is forced, or the driver is held up. Goods-in-Transit Insurance helps protect cargo while it's in transit, and with Auto and General, it's available as additional cover with Business Car Insurance. It's an important point to remember. Your business vehicle might be insured, your business might have general cover, but the goods inside the vehicle might not be. Becoming a significant financial risk for you and your business.

 A deeper look into South Africa’s small-scale logistics industry

The 2023 transport and storage survey results were only released in 2025. But they showed that 318,284 people were employed in the industry, with freight transport by road accounting for 125,009 employees 1. SMMEs accounted for 26.1% of total income and 37.5% of total employment in the sector. However, most small logistics operators work in a demanding space. There are tight delivery windows, several drop-off points, client pressure, and cargo that may be easily damaged or stolen. The risk is not only a major crash or a truck hijacking. A dropped pallet or a delivery delay can still result in a client claim. This means that Commercial Transportation Insurance is an integral part of running a reliable transport operation. It gives smaller operators a way to absorb the financial shock when goods are lost, stolen, or damaged while being moved.

What is Goods-in-Transit Insurance, and why does it matter?

Goods-in-Transit-Insurance covers goods while they are being transported from one location to another. Depending on your business, this could include stock, equipment, parcels, materials, or cargo. The goods may belong to you, your client, or a supplier. Either way, once they are in your care, a problem in transit becomes your business’s problem too. The risk of loss or damage is present before the vehicle even pulls away. Goods can be damaged during loading, stolen during a stop, lost between delivery points, or rejected after an accident.

Without the right cover, a single incident can mean paying for damaged goods, losing a client, or facing a legal claim.

How Goods-in-Transit Insurance differs from transport-related insurance

A common mistake is assuming that your Business Vehicle Insurance or general Business Insurance automatically covers the goods being transported. But that is not how the cover works. Vehicle Insurance focuses on the truck, van, bakkie, or trailer. It may cover repairs to the insured vehicle, theft of the vehicle, and third-party liability if the driver causes damage to someone else’s property. Transportation Insurance focuses on the cargo inside or on that vehicle. That cargo can have a very different value, risk profile, and claims process.

For example, a business delivers several pallets of bricks to a site. While being offloaded, one pallet breaks. Bricks fall onto the delivery truck, damaging a nearby parked car. The Commercial Vehicle Insurance policy may cover damage to the truck. The included Third-Party Cover may also cover damage to the parked car.

But the damaged bricks are a different matter. Without Good-in-Transit Insurance, the delivery vehicle owner will have to carry that cost directly. That is why cargo cover should be seen as a separate form of protection that works together with Business Vehicle Insurance.

The real risks businesses face in transit

The growth of online retail has put more delivery vehicles on the road, often carrying parcels that are easy to move and resell. South Africa’s online retail market grew by 29% to R71 billion in 2023, while sector estimates suggest that 20 to 25 delivery trucks and vans are hijacked each day 2.

Imagine that a courier collects a batch of goods from a supplier in Midrand and stops briefly en route to the final delivery. When he returns, the back door has been forced open, and the goods are gone. The client still expects delivery, and the transporter must now answer for the loss. Without the right cover, that loss can come straight off the profit line.

But transit risk is not limited to theft or hijacking. Consider another operator who transports boxed tiles to a building site. A sudden stop causes several boxes to shift and tiles to crack. The client rejects the damaged stock. The delivery still happened, but the transporter now faces the cost of replacing the damaged goods.

Smaller losses can hurt too. A fridge unit on a cold storage truck fails. A parcel is delivered to the wrong location and cannot be recovered. Each event can affect cash flow, delivery promises, and client trust. Which is why Goods-in-Transit Insurance for logistics operations is worth taking seriously, even if your business only runs a few vehicles.

Who should be considering this cover?

Goods-in-Transit Insurance isn't only for national freight companies. A small retailer delivering appliances across town, an owner-driver moving client parcels, a contractor carrying materials between sites, or a growing courier business with a few vans can all face the same basic problem: goods are in their care while being moved. The risk is the activity, not the size of the business. If your business moves goods for clients, suppliers, branches, or customers, Transportation Insurance should be part of your Commercial Transport Insurance essentials.

What does a typical policy actually cover?

A typical Transport Business Insurance policy helps cover goods against theft, loss, and accidental damage while they are being moved. It is essential that the amount covered matches the value of the cargo you usually carry. If you transport R80,000 worth of goods, but your limit is much lower, you will still be left with a shortfall. It's also important to consider the type of goods you transport. Fragile stock, refrigerated items, electronics, building materials, or high-value cargo may need different terms. As with any insurance policy, there will be exclusions and conditions. And you need to fully understand these to avoid having a claim rejected because of a single clause you missed. Before choosing a policy, consider what you move, how often you move it, and what a damaged or stolen load could cost your business.

How this cover supports business continuity and client trust

When goods are damaged or lost, the client usually cares about one thing first: how quickly you can make it right. The right cover gives your business room to respond without draining your operating cash.

For example, a small supplier delivers materials to a contractor, but part of the load is damaged before handover. With the right insurance, the supplier can start the claims process, arrange replacement stock, and keep the project moving.

The benefit of business continuity is that a setback need not become a broken contract or a lost client. Insurance helps protect the relationship, steady the business, and support recovery after something goes wrong.

How to approach getting cover

Start with the facts an insurer will need. What goods do you transport? What are they worth? How often do they move? Which routes do you use? Are you transporting locally, cross-border, or both? Be as accurate as possible. If the cargo value is too low, the routes are incomplete, or the type of goods is unclear, a claim may become more difficult later. Don't focus exclusively on the cost when comparing. Look at limits, exclusions, and excess requirements, as well as any bundled benefits. The right policy should match your actual operation, not what you want it to be.

4 Common gaps and mistakes to avoid

There are gaps and mistakes you can make that only become clear at the claims stage, when the cost is already real. Some of these include: 

• Assuming Business Vehicle Insurance covers cargo: Commercial Vehicle Insurance covers the vehicle and certain third-party claims, but not the goods being transported. That can leave the business carrying the cargo loss.

• Insuring for too little: If your policy limit is based on an average load, it may fall short on a high-value delivery. The shortfall then sits with the business.

• Skipping the exclusions and conditions: Security requirements, packaging rules, routes, and documents can all affect a claim. Overlooking them may delay payment or affect whether the claim is accepted.

• Forgetting to update the policy: Bigger loads, new routes, cross-border deliveries, or higher-value goods can change your risk. If the cover does not change with the business, gaps can appear quickly.

Frequently asked questions

• What does Goods-in-Transit Insurance cover?

This covers commercially transported goods against theft, loss, and accidental damage during transit. The exact cover depends on your policy, cargo type, transport method, limits, exclusions, and claim conditions.

• Is Goods-in-Transit Insurance different from Vehicle Insurance?

Yes. Business Vehicle Insurance covers the insured vehicle and certain third-party risks. Goods-in-Transit Insurance covers cargo in transit. A damaged van and damaged stock fall under different types of cover.

• Who needs Goods-in-Transit Insurance?

Any business that transports goods should consider it. This includes couriers, owner-drivers, fleet operators, retailers, contractors, wholesalers, and small businesses that deliver products to clients or move stock between sites.

• How is the cost of the insurance calculated?

Insurers usually look at the type of goods, cargo value, routes, distance, frequency of transport, claims history, security measures, and whether the cover is local or cross-border.

• How do I get a Cargo Insurance quote?

Provide accurate details on what you transport, how often you move it, where it travels, and the highest value carried at any one time. Then ask for an insurance quote that reflects your actual operations.

Get a Cargo Insurance quote

If your business moves goods for clients, suppliers, or your own operations, the right cover can help protect every delivery from becoming a financial risk. Get a Cargo Insurance quote from Auto and General. Our team will help you understand your options, check what applies to your business, and answer any questions before you choose cover.

Sources:

•  1 Statistics South Africa - https://www.statssa.gov.za/?page_id=1856&PPN=Report-71-02-01&SCH=74264

• 2 TechCentral - https://techcentral.co.za/hijackers-delivery-vans-online-shopping/251626/

Disclaimer: The information in this article is provided for informational purposes only and should not be construed as financial, legal, or medical advice. Auto and General is a licensed non-life insurer and FSP, Ts & Cs online.