Courier companies to offer new insurance deal

18 Oct 2013 - by Bianca Markram

The South African
Express Parcel Association
(Saepa) has partnered
with international service
warranty supplier FreightSafe
to bring to the express
delivery market in South
Africa the means to offer a
better service to customers.
FreightSafe offers express
delivery companies a service
warranty they can sell to
customers using express
delivery services in the event
of loss or damage to a specific
consignment.
The warranty offers
customers the replacement
value of an item that has been
shipped, but has been lost or
damaged while in the care of
the carrier.
The upside for express
delivery
carriers is
that it helps
improve
customer
confidence
in the service
provided,
as well as
keeping
customer
relations
intact.
“This
warranty
resolves an awkward
customer service situation,”
Garry Marshall, executive
director of Saepa, said.
“Although express
freight is the most secure
transportation sector and
loss or damage is rare, when
there is a claim, it can be
uncomfortable to have to
cite the terms and conditions
about the limits to a carrier’s
liability of a consignment in
its care.”
Furthermore, carriers
providing this service will
receive the money paid from
the customer for the warranty
to keep in a pot. Whatever
is not paid out in claims
goes directly to the express
delivery company’s bottom
line.
FreightSafe acts as an
independent assessor and
adjudicator in the event of
claims, meaning that any
investigations regarding lost
or damaged consignments
will be handled by
FreightSafe, while business
can carry on between the
carrier and its customer.
“The service
provider is
able to add
competitive
advantage
without
becoming
involved in the
administrative
burden [of the
product], which
is shouldered
by a neutral
third party
[FreightSafe],”
Pam Eley, business
development manager at
FreightSafe South Africa,
said.
Often the consignments
are too small and infrequent
for regular marine insurance
to cover loss or damage.
The customer would in
such a case pay the value or
more than
the value of the item in
question in excess on the
marine insurance policy,
and thereby lose out on
recovering any value of the
consignment.
The
FreightSafe
warranty,
however, will
pay out the
full value
without the
impediment
of an excess.
In the event
of a marine
policy payout,
the
warranty amount would go
towards the excess.
The warranty has been
reviewed by the Financial
Services Board, which ruled
that the product was not in
contravention of the Shortterm
Insurance Act, thereby
deemed usable by the South
African express delivery
carriers, according to Saepa.
“We endorse this product
and think it will make a
wonderful value addition
in services offered by
express delivery companies,”
Marshall said.
The
warranty
is well
established
in Australia.
It recently
launched
in the UK,
while some
companies in
South Africa
have been
using it to
great effect.
Marshall noted that
FreightSafe had the capacity
to build the warranty around
the specific needs of each
service provider and its
unique customer blend and
shipments.