Courier companies to offer new insurance deal

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. INSERT & CAPTION 1 The FreightSafe warranty will pay out the full value without the impediment of an excess. – Pam Eley INSERT & CAPTION 2 This warranty resolves an awkward customer service situation. – Gary Marshall