With about three million "18-wheeler" trucks operating in the U.S. and the demand for timely delivery of cargo, the transportation sector is often defined by its complexity and the speed at which decisions must be made.
For freight brokers and motor carriers, arranging cargo insurance has, until recently, been a manual and time-consuming process. The value of many shipments is higher than the $100,000 basic cargo insurance coverage carried by most trucking companies. It could take a day or more to secure supplemental coverage for high-value or specialized loads. In an industry where hours can mean the difference between winning and losing a shipment, this lag is more than an inconvenience; it is a money-loser.
Recent advances in embedded insurance technology are beginning to emerge as a game-changer. In consumer transactions, embedded insurance has been commonplace for years. Examples of this are the travel insurance offered during flight bookings or ticket insurance at checkout for major sports events and concerts. But in business-to-business (B2B) transactions, embedded insurance has been limited. Now, that is shifting, and the implications for freight risk management are significant.
Moving Beyond the Consumer Model
Embedded insurance, when you break it down to basics, refers to the integration of insurance products into a broader transaction or workflow. This allows users such as freight brokers, shippers and motor truck carriers to access and bind coverage without leaving their primary platform. In the consumer world, embedded insurance is often a simple checkbox at the point of sale. In the B2B context, the complexity is greater, and the requirements for expertise are much higher.
The challenge in commercial freight has been twofold. First, there is the need for custom coverage based on shipment specifics such as the goods being transported, the value of the load and the points of origin and destination. Second, there has been a lack of digital infrastructure to support instant quoting and policy issuance at the moment a load is arranged. As a result, many freight brokers and motor carriers have relied on time-consuming manual processes such as emails and phone calls. This causes friction, delays and sometimes lost business opportunities.
A Case Study in B2B Embedded Insurance
The sort of system developed at Logistiq Insurance Solutions, called Freight Insurance Fast, addresses these challenges. The program runs on a software application with an application programming interface (API) designed to integrate directly into transportation management systems (TMS), load boards, and other logistics platforms. This enables freight brokers and motor carriers to access high-quality shipper's interest policies instantly, precisely at the point in the workflow when insurance is most often required, which is when the details of a load are being finalized.
Early adopters have seen immediate benefits. Users can secure supplemental cargo coverage in seconds rather than hours or days. This reduces manual administrative steps and keeps shipments moving. This timeliness is especially valuable because rising insurance premiums have led many motor carriers to lower their standard ($100,000 per load) coverage limits, making spot insurance a necessity for higher-value loads. Verisk CargoNet reports 3,625 cargo theft incidents in 2024, a 27% increase from 2023, with the average loss climbing to approximately $202,000 per theft, underscoring the need for adequate insurance on high-value loads.
Efficiency, Transparency, and the Role of Expertise
The integration of embedded insurance into freight workflows does more than save time. It also creates a more transparent and informed decision-making process. By using shipment data already entered into a TMS, the system can accurately price risk and present coverage options for the specific load. This not only reduces errors and gaps in coverage but also helps brokers and carriers make better risk management decisions without leaving their "go-to" workflows.
It's also important to note that embedded insurance in the freight sector is not only about automating transactions. The most effective embedded solutions combine digital convenience with deep insurance expertise. This ensures that users are not simply rushed to a purchase but are guided toward the right coverage for their needs.
The Road Ahead for B2B Embedded Insurance
The adoption of API-based, digitally delivered embedded insurance in B2B logistics is still in its early days, but the momentum is clear. As more TMS providers, load boards, insurance agencies, and vetting companies recognize the value of integrated insurance solutions, we can expect to see broader uptake and continued innovation in this space. For freight brokers and motor carriers, the result is a more agile, efficient, and resilient supply chain, one where risk management keeps pace with the speed of business.
As the insurance industry continues to explore the possibilities of embedded products, the freight sector offers a compelling case study in how the well-thought-out integration of insurance can help to improve operational efficiency and provide better risk outcomes. The lessons here are broadly applicable; when insurance is delivered at the right moment, in the right context, and with the right expertise, everyone from the underwriter to the end customer enjoys the benefits.
