What is the definition of cargo insurance?

Cargo insurance is defined as insurance coverage that protects goods in transit against loss or damage. This type of insurance is crucial in international logistics as it provides financial protection for importers and exporters against unforeseen risks that may occur while goods are being transported. Such risks can include theft, damage from accidents, natural disasters, or other incidents that might compromise the integrity of the cargo.

Recognizing cargo insurance's scope emphasizes its relevance in ensuring that businesses can mitigate losses associated with international shipping. This coverage can apply to various modes of transportation including air, sea, and land, making it a fundamental aspect of supply chain risk management.

In contrast, the other options illustrate limitations that cargo insurance does not have. For instance, it is not restricted to domestic shipments alone, nor does it guarantee delivery timeframes. Additionally, cargo insurance is applicable for all transport methods, not just air transport, ensuring that businesses have broader coverage regardless of how their goods are moved. Understanding this definition helps grasp the essential role of cargo insurance in safeguarding investments during international trade.