Goods in transit insurance: what your policy actually covers

Your driver left the Kempton Park warehouse at seven on a Tuesday morning with a full load of stainless-steel catering equipment. By the time he reached the N3 outside Heidelberg, someone had forced the rear doors at a weigh-bridge stop. A third of the load was gone. The claim came in at R280,000, and the insurer's response referenced a clause about unattended vehicles, one nobody in your office had read, because nobody in your office knew it was there. The gap between what a policy promises and what it pays is where cargo owners absorb losses they believed were covered.

What is goods in transit cover?

Goods in transit cover, often written as GIT insurance, is the section of a commercial insurance policy that pays for loss of or damage to cargo while it is being transported. It responds between the moment goods leave the sender's premises and the moment they arrive at the receiver's. The cover travels with the cargo, not with the truck.

Key Takeaways

• GIT cover responds to theft, accident damage, and some accidental loss events while cargo is in transit, but the wording defines the scope precisely.
• Most South African GIT policies exclude loss from unattended vehicles, unless the vehicle was in a locked, enclosed facility or the theft involved forced entry.
• The insured value must reflect replacement cost, not book value. Underinsurance triggers the average clause, and the shortfall is the cargo owner's to absorb.
• SASRIA cover is a separate add-on; standard GIT policies don't respond to riot, strike, or civil unrest damage.
• The transit period has defined start and end points. Cargo sitting in a yard waiting for collection, or held in a warehouse between legs, may fall outside the cover window.

What a standard GIT policy responds to

A standard goods in transit cover policy pays for physical loss of or damage to the insured cargo caused by a named peril during the transit period. The named perils in most South African GIT policies include accidental collision or overturning of the carrying vehicle, fire, lightning, explosion, and theft involving violent or forcible entry into the vehicle. Some policies extend to flooding of the load during transit and to accidental damage during loading and unloading.

The critical phrase is "violent or forcible entry." If a driver leaves a curtain-side trailer unattended at a roadside stop and returns to find the curtain sliced and a pallet missing, the insurer's first question is whether force was used on the vehicle. A sliced curtain is generally accepted as evidence of forcible entry. A door lock not engaged before the driver stepped away is not. The outcome turns on the wording, and the wording turns on facts the driver and fleet manager need to know before the loss happens, not after.

The transit period is equally important. GIT cover responds while cargo is in the course of transit. That phrase is defined in the policy, and the definition usually ties the period to the moment the vehicle's engine starts at point of collection and ends when the goods are delivered and signed for at destination. Cargo left overnight in a yard before a scheduled morning departure may not be in transit at all. A Durban freight operator storing a client's electronics load in an unfenced yard between collection and the next morning's dispatch found the policy silent on that specific window, and the theft happened at 2 a.m.

Typical GIT policy response: named perils and conditions

Where the exclusions sit

The exclusions in a GIT policy do more damage than the perils it responds to, because few people read them before the claim arrives. The unattended vehicle exclusion is the one South African claims managers see most often. It applies when the driver has left the vehicle and its load without a person present to guard it. Most policies define "unattended" as out of sight or more than a set distance from the vehicle, and that threshold is shorter than most drivers assume.

Beyond the unattended vehicle clause, three further exclusions catch businesses off guard. The first is inherent vice: deterioration, shrinkage, or loss of quality the goods suffer from their own nature during transit, regardless of what happens to the vehicle. Frozen prawns arriving warm because the refrigeration unit failed on a long run fall into this category on most standard policies. The trailer wasn't in an accident and the goods weren't stolen; they simply spoiled. The second is inadequate packing. If a manufacturer ships fragile ceramic tiles in a single-layer cardboard sleeve and they arrive broken, the insurer will examine whether the packing met the standard required for that class of goods. The third is delay. GIT cover doesn't pay for losses caused by late delivery: a shipment of cut flowers wilting because the truck sat in a traffic hold-up for twelve hours isn't a GIT claim, even if the financial loss is real.

A Polokwane food distributor discovered the inadequate packing exclusion in a way their logistics manager still recounts. Two pallets of bottled hot sauce were wrapped in stretch film without internal corner bracing. When the truck braked hard on the N1, the pallets shifted, bottles shattered, and the load was written off. The insurer applied the packing exclusion, paid nothing, and the distributor absorbed the full replacement cost plus the cleaning bill.

SASRIA and the political violence gap

Standard goods in transit cover doesn't respond to loss or damage caused by riot, strike, civil unrest, or political violence. That class of risk sits with SASRIA, the state-owned special-risks insurer carrying this cover on behalf of the South African market. Think of SASRIA as a separate policy attached to your main cover: your broker collects the SASRIA premium alongside the standard GIT premium, but the two policies respond to entirely different events, and both must be in place for cargo to be protected against the full range of perils it faces on a South African road.

The July 2021 unrest in KwaZulu-Natal illustrated this separation clearly. Loads moving through Durban during that period faced vehicle hijackings, road blockages, and burning trucks, events a standard GIT policy doesn't cover. Businesses with SASRIA cover in place recovered their cargo losses from SASRIA. Those without it absorbed the loss. SASRIA's special risks cover schedule confirms which classes of cargo and transport are eligible for SASRIA cover, and the premiums are calculated as a percentage of the insured value. They aren't expensive relative to the exposure they cover; they are, however, optional, and brokers who don't raise the question leave the gap open.

The Policyholder Protection Rules under the Insurance Act 18 of 2017 require insurers to explain material exclusions in policy documents, but they don't require a broker to confirm a client has understood them. The responsibility for knowing what your GIT policy excludes lands on the insured.

The insured value problem

The most common structural flaw in South African goods in transit cover isn't an exclusion. It is the declared value. GIT policies pay out on the insured value of the cargo, and the insured value is the number the policyholder supplied at inception or renewal. If that number was set when the goods cost less, renewed automatically year on year, and never revisited when replacement costs rose, the policy carries a number no longer reflecting reality.

The average clause works like this: if you insured R500,000 worth of cargo and the insurer can demonstrate the correct replacement value at the time of the loss was R800,000, you have effectively carried 37.5 percent of the risk yourself. A R400,000 claim pays out at R250,000. The arithmetic doesn't care you paid premiums faithfully for six years. The FSCA's guidance on underinsurance and the application of average in short-term insurance policies is clear: the insured bears the shortfall.

For businesses moving high-value or volatile-cost cargo, the correct approach is to insure on a per-consignment basis with a declared value attached to each waybill, rather than on a blanket annual value. This requires more administrative discipline, but it closes the underinsurance gap. A Johannesburg electronics distributor moving consignments ranging from R80,000 to R600,000 can't protect both ends of that range with a single mid-point blanket value.

How a GIT claim is assessed

When a goods in transit claim is lodged, the insurer's process follows a predictable structure, and understanding that structure before a loss happens is the difference between a clean claim and a disputed one. The insurer will ask for the original invoice or proof of ownership for the goods, the waybill or consignment note, the driver's statement, any police case number where theft is alleged, photographs of damage or the point of entry, and the vehicle's roadworthiness certificate.

The police case number is a non-negotiable requirement for theft claims. In the scenario opening this article, the driver called his depot manager first and the police second, which meant the case number arrived three hours after the loss. That delay doesn't void the claim, but it introduces a complication. Insurers treat a late police report as a flag worth investigating, because it creates a window during which the theft story can be constructed rather than reported. Claim handlers aren't cynical by nature; they are paid to notice timing.

The loss adjuster's role is to verify the quantum of the claim against the insured value and the applicable wording. They work for the insurer, not for you. Their mandate is accurate assessment, not advocacy. The National Financial Ombud Scheme handles disputes where an insured believes the assessment was unfair, and their published rulings on cargo and transit claims show how consistently the "unattended vehicle" and "inadequate packing" exclusions are upheld when the wording is unambiguous. If you believe a repudiation is wrong, that is your first port of call.

A GIT claim well-documented, promptly reported, and supported by a clear paper trail from waybill to police affidavit generally settles within four to eight weeks for a straightforward loss. A disputed claim involving questions of packing adequacy or the unattended vehicle exclusion can run considerably longer, and the outcome often hinges on a single line in the policy wording.

Annual blanket cover versus per-consignment declarations

South African GIT policies are structured in two main ways, and choosing the wrong one for the nature of your cargo movements is a structural mistake no amount of careful claims management can fix. An annual blanket policy sets a single aggregate limit for all transit during the policy year. It suits businesses moving cargo of consistent value and type on regular routes. A per-consignment policy requires the insured to declare each shipment individually, either at the time of dispatch or within a defined period after it. It suits businesses whose consignment values vary widely, or who move high-value loads infrequently.

The practical risk with an annual blanket policy is the single-event sublimit. Most GIT blanket policies contain a limit per conveyance, meaning the maximum the policy pays on any one vehicle in any one loss event. A business regularly loading a single truck with R1.2 million in goods against a per-conveyance limit of R750,000 carries a R450,000 exposure on every trip, and the policy schedule might not make that sublimit obvious.

The SAIA code of conduct for short-term insurers requires material terms, conditions, and limits to be disclosed clearly in policy documents, but the per-conveyance limit routinely sits in the definitions section rather than the schedule. It is there, and it is valid, and it applies, but it doesn't appear on the one-page summary most business owners file and call their policy.

When the goods aren't yours

A final layer trips up transport operators and freight forwarders: goods in transit cover protects the insured's own interest in the cargo, not a contractual liability to someone else's goods. A road hauler carrying a client's goods under a contract of carriage doesn't need GIT cover for the cargo. They need goods-in-transit liability cover, which is a different policy section responding to the hauler's legal liability to the cargo owner when the goods are damaged or lost through negligence.

Confusing these two isn't unusual. The Road Freight Association has noted in its member guidance many smaller transport operators carry GIT cover on loads they are hauling for clients, then discover at claim time the policy responds to the owner's interest, and they aren't the owner. The liability claim, the client suing the hauler for the damaged load, is a separate matter requiring separate cover. Domestic cargo insurance and marine liability cover are the relevant sibling topics if your business sits on the carrier side of the transaction rather than the cargo-owner side.

The distance between the schedule and the policy wording

A goods in transit policy isn't the one-page summary in the file. It is the full wording document: the definitions, the conditions, the exclusions, and the endorsements attached to it. The schedule records the agreed insured value, the premium, the named insured, and the period of cover. The wording governs what happens when a claim is made. Those two documents need to be read together before you move cargo, not after you lose it.

You shouldn't have to find out at claim time what your GIT policy excludes. With Mont Blanc Financial Services you won't.

Contact Mont Blanc Financial Services to have your transit cover read, tested against your actual cargo movements, and corrected before the next consignment leaves the yard.

Goods in transit cover generates more questions than most commercial policies, because the circumstances of each loss differ. The questions below address the ones South African cargo owners and fleet operators ask most often.

Frequently Asked Questions

Does goods in transit cover apply when my driver stops overnight?

Most South African GIT policies treat an overnight stop as a gap unless the vehicle is parked in a locked, enclosed facility such as a guarded yard or bonded warehouse. If the driver parks at a truck stop, a roadside garage, or a residential address, the unattended vehicle exclusion typically applies from the moment the cab is vacated. Some policies extend limited overnight cover if the vehicle is fitted with a tracking device and an active armed-response subscription, but that extension must be endorsed onto the policy in writing. The safer operational approach is to route overnight stops through approved overnight facilities recognised by your insurer, and to confirm in writing those facilities satisfy the unattended vehicle clause. If your routes regularly require overnight stops, ask your broker to confirm the policy wording before the next trip departs, not after the next theft. A written endorsement confirming overnight facility approval takes a broker an hour to obtain and closes a gap worth tens of thousands of rands on a single night's exposure.

How do I calculate the correct insured value for my goods in transit cover?

The correct insured value is the replacement cost of the cargo at the time of transit, not the book value, the original purchase price, or the price you charged the customer. For manufactured goods, replacement cost means what it would cost to reproduce or repurchase the goods at current prices. For imported goods, it includes the landed cost: the invoice value plus freight, insurance, and applicable duties. Insuring at selling price rather than replacement cost tends to overcomplicate the calculation and can trigger disputes at claim stage. Update your declared values at each renewal, and where cargo values fluctuate significantly between consignments, discuss a per-consignment declaration structure with your broker to avoid the average clause applying to high-value loads insured at a lower average figure. A distributor moving both low-value and high-value consignments on the same blanket limit is carrying uninsured exposure on every high-value run, whether or not the policy schedule reflects it.

Is SASRIA cover automatically included in my goods in transit policy?

No. SASRIA cover isn't automatically included in any standard short-term policy, including GIT cover. It must be specifically added. Your broker should raise this at inception and at each renewal, because the SASRIA premium is collected alongside the standard premium and passed through to SASRIA, but the two covers respond to entirely separate categories of loss. A standard GIT policy responding to collision and theft doesn't respond to a hijacking carried out by a mob during civil unrest. SASRIA responds to that event. SASRIA's published cover schedule lists the eligible cargo classes and the applicable limits. Given the frequency of unrest-related cargo losses in South Africa over the past five years, leaving SASRIA cover off a GIT policy is a structural gap difficult to justify at claim time. If your broker has not confirmed SASRIA status in writing at your last renewal, treat that as an open question requiring an answer before your next consignment moves.

What happens if my cargo is damaged during loading or unloading?

Loading and unloading cover isn't standard across all GIT policies. It depends on whether the policy includes an "all risks" extension or limits itself to named perils. Under a named-perils policy, damage during loading is covered only if it results from a listed event such as accidental collision with a fixed object or the overturning of mechanical handling equipment. Drops, spillages, and compression damage during manual loading are frequently excluded unless the "all risks" extension is in place. If your goods are fragile, high-value, or regularly loaded and unloaded by third-party facilities, an all-risks GIT policy is the appropriate structure, and the extension should be confirmed in the policy schedule, not assumed from a broker's verbal assurance. The Policyholder Protection Rules confirm verbal assurances aren't cover. A warehouse operator cracking a pallet of ceramic sanitaryware during forklift loading is a scenario most named-perils policies won't respond to without the all-risks extension in place.

Can I claim for goods stolen from a parked trailer while the cab is still on site?

It depends on whether the cab and the trailer are considered a single unit under the policy wording. Some GIT policies treat the cab and the trailer as one vehicle, so the driver being present in the cab satisfies the "attended" requirement. Others define "attended" as the driver being able to observe the trailer directly. If the cab was parked at a loading bay twenty metres from the trailer and the trailer doors were forced while the driver waited in the cab, most insurers will treat the situation as attended and the claim will proceed. If the driver was in a canteen inside a building with no sightline to the trailer, the outcome is less certain. The determining factor is the definition of "attended" in your specific policy wording. Ask your broker to confirm the definition before your drivers discover the answer through a loss; a written confirmation costs nothing and removes an ambiguity worth a full load in the wrong circumstances.