The Impact of Cargo Crime: An Insurance Perspective
Cargo crime is a significant concern in the UK, particularly affecting the manufacturing sector due to the high value and volume of goods in transit. In 2023, the National Vehicle Crime Intelligence Service reported 5,373 cargo theft cases, resulting in an estimated £68 million in stolen goods1. This growing threat underscores the necessity for enhanced security measures to protect businesses from financial losses, operational disruptions, and reputational damage2.
Key Risk Factors for the Manufacturing Sector
● Geographic Vulnerabilities: Ports, distribution hubs, and transit routes are prime targets for cargo theft due to the high volume of goods passing through these areas.
● Insufficient Security Investment: A lack of robust physical, digital, and operational protection measures increases the risk of theft.
● Insider Threats and Organised Crime: These elements can exploit employees for access to sensitive information.
● Complex Supply Chains: Reliance on third-party logistics providers makes manufacturers more susceptible to cargo theft.
Risk Management Strategies for Manufacturers
Preventative Measures
● Upgrading Physical Security: Investing in GPS tracking, tamper-proof locks, and secure vehicle parking can reduce theft risks. Surveillance systems at warehouses and distribution hubs also deter criminal activity3.
● Conducting Supply Chain Audits: Regular audits help identify vulnerabilities, enabling targeted improvements to mitigate risks.
● Employee Training: Training programs raise awareness, guiding workers to recognise and report suspicious activity, thus spotting internal threats early.
Technology Solutions
● Leveraging AI and IoT: These systems analyse real-time data to detect patterns and potential threats, providing early warnings.
● Enhancing Cybersecurity: As logistics systems digitise, prioritising cybersecurity protects against hacking and ransomware. Stringent protocols safeguard the supply chain.
Collaboration and Partnerships
● Working with Logistics Providers and Experts: Collaborating with logistics providers and risk management professionals ensures consistent security protocols throughout the supply chain. Sharing strategies reduces vulnerabilities.
Insurance and Financial Protection
Comprehensive cargo insurance mitigates the financial impact of theft. Manufacturers should work with risk advisors to ensure policies cover potential losses, including exclusions, coverage limits, and recovery costs.
How Gallagher Can Help
Mitigating cargo crime is crucial for protecting assets and maintaining operational efficiency. Partnering with a risk management specialist like Gallagher provides the expertise and tailored solutions needed to reduce exposure to such risks. We help businesses prioritise security, enhance collaboration, and implement proactive strategies to safeguard physical and financial assets.
Sources
1 Lefevresain, Rémi. “Are Freight Crimes Threatening the UK Economy's Stability?” Logistics Curated, 21 Nov 2024.
2 Stenson, Clodagh, and Alex Bish. “Lorry Thefts: Stolen Cargo, Stress and Slashed Curtains,” BBC, 31 Jul 2024.
3 “Tackling Cargo Crime in 2024 Cargo Crime on UK Roads Has Risen During the Cost of Living Crisis,” Airmic, 04 Sep 2024.
Click here to contact us to discover how Gallagher can help safeguard your operations against cargo crime.
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