In global commerce, business is conducted where business is, from bustling city centres to the most remote corners of the world. For some, maintaining operations in foreign countries is the norm, not the exception. At If, we understand that while such locations can present unique transportation risks, it is often a risk worth taking.
Business in the Nordic regions has shown a trend of expanding operations into previously unfamiliar territories. When branching out, it is vital to grasp the risks and to devise the strategies to manage and mitigate them effectively. Get an overview of the typical risks encountered and how If’s Cargo Insurance can help support businesses in navigating these complexities.
Companies must anticipate all the many types of challenges they face when entering less familiar markets. Taking cargo as an example, occasionally significant investments are allocated to areas with extreme weather conditions. This can impact the feasibility of transportation during certain seasons or over certain terrains, such as ice roads.
Furthermore, local infrastructure—or the lack thereof, including roads, bridges, and harbours—can introduce additional risks to timely deliveries. Choosing experienced and reliable transportation partners or local subcontractors is essential, as unproven partners can introduce surprising and unwanted additional risks as well as uncertainties to the logistics chain.
However, when a company enters into new and remote markets, there are normally no or few sub-contractors available, which are known either to the companies themselves or to other co-operation partners. Even if it is possible to find more than one there is no guarantee that it is possible to find the required special equipment from more than one service provider. When this happens, it is of vital importance that inspections are carried out both at the point of departure of the transportation as well as at the other end of the sea voyage.
A dual-check system helps confirm the condition of goods pre-and post-transport, and ensure that loading and unloading procedures meet the highest standards. In addition, checking the transportation equipment before, e.g., a demanding inland transportation is a prerequisite for ensuring goods arrive at their destination intact.
The complexities of international trade laws necessitate a deep understanding of local insurance regulations. Many developing countries mandate that only domestic insurers cover risks within their borders. In the same way reinsurance is primarily only given exclusively to domestic insurers.
In cases where domestic insurers and reinsurers are completely or partially unable to underwrite the risk or in fact do not want to underwrite the risk, it is possible to resort to foreign capacity. If has established a vast network capable of arranging compliant insurance coverage in over two hundred countries, ensuring seamless integration into global transportation insurance programs.
Insurance considerations should parallel the initial stages of trade negotiations, regardless of the industry or scale of the project. Early engagement ensures sufficient time to ascertain whether existing global cargo insurance programs suffice or if local insurance solutions are necessary. Pre-shipment surveys, cargo risk assessments, and equipment inspections are part of the comprehensive services we provide to reflect on and manage transportation risks.
As economic trade channels follow geopolitical trends, Nordic industrial enterprises venture into territories around the globe, including South America, former CIS countries, Asia, and more. We are commited to supporting our clients in conquering markets wherever they are, leveraging our extensive experience in risk surveying and insurance provision to the more distant locations of the world.
We encourage you to consult the detailed lists of high-risk areas and countries with restrictive insurance legislation available on our website. These resources are invaluable when setting out to navigate and conquer the complex landscapes of faraway markets.