Goods in transit insurance

What is goods in transit insurance?

Goods in transit (GIT) insurance is designed to protect the goods in your van while they’re being transported from one place to another.

It covers your or your customers’ goods if they are lost, damaged or stolen while they’re on the road – for example, when they’re being transported from a factory or workshop to a retail outlet, business premises or private property.

GIT insurance only covers the contents of your vehicle, and only while they’re in transit – not before you depart or once they’ve been delivered. It’s an additional insurance and doesn’t replace your van insurance policy, which covers the vehicle itself and is required by law.

You may be able to get GIT insurance as an add-on to your vehicle policy or as part of a business insurance package. Alternatively, you could buy goods in transit insurance as a standalone policy from a specialist provider.

Who needs goods in transit insurance?

Any business that regularly moves goods between locations could benefit from goods in transit insurance.

GIT cover is particularly important for:

• Courier services

• Removal services

• Haulage companies

• Car transportation in the motor industry

• Businesses that deliver directly to their customers

• Businesses that move supplies from one site to another.

If you offer delivery of purchased goods – if you run an online shop, for example – GIT cover could protect items while they’re on their way to the customer. It could also cover you for any costs if the item is undelivered.

If it’s your goods that are being transported, remember that the carrier’s insurance is designed to protect their business, not yours.

For example, if you’re using a removals company to move business premises, a standard policy might not cover more complicated or unusual situations. You may want to include specific terms about how you want your goods to be covered by insurance in your contract with the carrier.

What does goods in transit insurance cover?

Typically, goods in transit insurance could protect the goods in your van against:

• Theft

• Loss

• Damage caused by accidents during transit

• Damage caused during loading, unloading or transit.

Damage may include a variety of eventualities – from weather and pest infestation, to something being dropped during unloading or falling off the vehicle while it’s travelling. Again, it’s best to check your policy, especially if you’re carrying delicate items.

What doesn’t goods in transit insurance cover?

GIT insurance generally won’t cover:

• Loss as a result of poor, defective or insufficient packaging

• Shortage in weight

• Loss because of deterioration or variation in temperature – for example, caused by a breakdown of a refrigeration unit – unless agreed with the insurance provider and included in the policy

• Dangerous goods, money, livestock and high theft-risk goods – unless agreed with the insurance provider and included in the policy

• Theft from unattended vehicles, unless agreed security is in place

• Confiscation or requisition by a government or public authority.

What should I look out for when buying goods in transit insurance?

When choosing your policy, there are a few details to check:

The terms around loading and unloading

You need to fully understand where your liabilities start and finish. For example, you may be covered if damage happens while a forklift truck driver is placing a loaded pallet on your truck. But you might not be covered for the 10 seconds earlier when that forklift was loading up on the other side of the yard.

The terms around refrigerated items, livestock or high-value items

If you’re carrying goods that are temperature or humidity controlled, you’ll need to make sure you’re covered correctly if the control unit fails and the goods are spoiled.

Maximum cost-by-weight liability

Some policies will have a maximum cost-by-weight for the goods being transported, should they be damaged.

These policies are particularly useful if you operate under standard Road Haulage Association (RHA) conditions with a set liability per tonne. These should offer the level of cover you need, regardless of the actual value of the goods you’re carrying.

But for some items you might need to buy extra cover, so always check policy details.

Additional cover

Check to see if the policy offers cover for the following and, if not, whether you can add it for an extra cost:

• Your trailer

• Your own items used to protect the goods, such as straps, ropes, tarpaulin sheets and fastenings

• Customers’ property

• The driver’s personal property

• Storage cover

• Hazardous items

• Transporting goods abroad

• Public liability

• Employers' liability.

Is goods in transit insurance required by law?

You’re not legally required to have GIT insurance. But customers might insist on it before allowing you to carry goods for them.

Also, not having it could prove very expensive. You’re responsible for your client’s property, equipment or goods while they’re in your possession. Without the right goods in transit insurance, you could be liable for any costs if anything is damaged, lost or stolen.

You could also find yourself open to claims for consequential loss – for example, if a manufacturer has to shut down a production line due to something not being delivered.

What level of cover do I need?

The level of cover you’ll need depends on what you’re carrying and whether goods are being carried under specific contractual requirements or international rules.

The level of cover you choose should reflect your liabilities based on the contracts you have with your customers. The recipient of the goods should be clear about exactly what you would be liable for in the event of a loss.

For example, someone delivering important documents or diamonds might need a completely different level of cover from a haulier shifting gravel or a car transporter moving vehicles from manufacturer to dealer.

The level of cover you need will also depend on whether you’re transporting goods entirely in the UK or if international collection or delivery is required. Common contractual conditions include:

• RHA Conditions of Carriage (2024) – you’ll need to be a Road Haulage Association (RHA) member and use the RHA Conditions of Carriage correctly. This enables you to limit your liability for the goods you carry to a maximum of £1,300 per tonne on the gross weight of goods lost, wrongly delivered, or damaged. The RHA conditions set out the responsibilities of customer and consignor (the shipment sender) around the collection, transportation and delivery of goods.

• CMR conditions – if goods are being transported internationally by road, you’ll need to make sure your GIT insurance covers you for the liabilities created by the UN’s CMR convention. This is a standard set of transport and liability conditions which replaces individual businesses’ terms and conditions.

• Full value – if you’re not using specific contract conditions like the RHA’s, you may need cover for full responsibility for the goods.

If you’re a self-employed owner-driver delivering on behalf of another network, it’s best to check the level of GIT insurance you need to have before buying a policy.

Typically, goods in transit policies are non-refundable and fees may apply to make changes after the policy starts. So, it’s important to provide full information and carefully compare policies upfront.

How can I get cheaper goods in transit insurance?

The cheapest quote won’t necessarily provide you with the cover you need. However, there may be ways to cut your insurance costs. These include:

• Improving your vehicle’s security – to reduce the risk of theft

• Accurately assessing the value of goods you’re moving – overestimating could see you paying above the odds for your premiums, while underestimating could mean you don’t have enough cover

• Changing to a black box policy – some insurance providers offer discounts if you can prove you’re a safe driver.

What’s the difference between goods in transit insurance and courier insurance?

The main difference is that GIT insurance covers the items you’re transporting, while courier insurance is a specialist type of vehicle cover. The latter is sometimes known as ‘hire and reward’ insurance.

Courier insurance is designed to cover you for damage to your vehicle or any injuries suffered by the courier. It also covers any third-party damage to other vehicles, people or property.

Some courier insurance policies will also insure the contents of the vehicle up to a limited amount. But it can often be hard for couriers to accurately estimate the value of the goods they’re delivering.

Do I need public liability insurance as well as goods in transit insurance?

Whether you need public liability insurance depends on the nature of your business and your level of interaction with other people. Goods in transit will only cover the goods you’re transporting. It won’t cover injuries to people you may come across while doing your job.

Your commercial vehicle insurance should cover you for damage or injury to people and property while in your vehicle, if you think you need it.

Let’s say you run a removals company. What if you injure someone or damage their property while you’re loading and unloading furniture? Public liability insurance could cover you for injury to people and damage to third-party property when you’re not driving.

Some goods in transit policies include public liability cover as standard. It’s worth double-checking if you think you may need the extra cover.

Compare van insurance

You can do a comparison quote for van insurance for haulage (using your vehicle for the carriage of goods for hire or reward) through Compare the Market. However, this will just protect you and the van – not the contents.

If you want goods in transit insurance, you may be able to get it as an add-on to your policy. Or you could buy a standalone goods in transit policy directly from a specialist insurance provider.