Carrier Legal Liability Insurance for Lorry and Haulage Companies in Malaysia: What Is Covered?

The short answer

Carrier legal liability insurance covers a lorry or haulage company's legal responsibility for customers' goods that are lost, stolen or damaged while being transported, loaded or unloaded. It pays the customer's valid claim against you, plus defence costs, within the limits and conditions of the policy. It does not insure the truck itself, which falls under motor insurance.

What is carrier legal liability insurance?

When you take on goods for delivery, you become responsible for them until they reach the consignee. If something goes wrong, the customer can claim against you. Carrier legal liability insurance is designed for that exposure. It is sometimes called carrier's liability, haulier's liability or goods in transit (carrier's) cover, depending on the insurer.

What is usually covered?

Wording varies by insurer, so always read the policy. Typical cover includes:

• Accident: goods damaged when a lorry overturns, collides or is involved in another road accident
• Fire and explosion affecting the goods in your vehicle
• Theft: theft of the whole load or part of it, subject to security conditions
• Handling damage during loading and unloading, if the policy includes it, so confirm this with your broker
• Legal costs to defend a claim made against you

What is usually excluded?

• Damage caused by inadequate packing by the sender
• Goods left unattended in breach of security conditions
• Deliberate or dishonest acts by your staff, unless specifically covered
• Perishable goods affected by refrigeration breakdown, unless the cover is extended
• Specified high-risk goods such as cash, jewellery or dangerous goods
• Delay, unless the policy says otherwise

What does the insurer want to know?

To arrange cover correctly, a broker or insurer will ask about:

• The types of goods you carry and any high-risk items
• Routes, distances and whether you cross borders
• The number and type of vehicles
• Security measures such as locks, tracking and driver rules
• Your conditions of carriage and how you limit liability
• Subcontractors you use and how they are covered
• Past claims

Does my motor policy already cover this?

Generally no. Motor insurance covers the vehicle and third-party injury or property damage on the road. It does not usually cover the goods you carry for customers. That is the gap carrier legal liability fills.

Common questions

Do I need it if I use subcontract drivers?
Yes. The customer's contract is still with you. Make sure the subcontractor's cover and your own are aligned.

What if the goods belong to me?
Then you want cargo or goods in transit cover for your own stock, rather than liability cover. See our article on marine insurance vs. goods in transit insurance.

Can I cover cross-border trips?
Sometimes, but territory is normally defined in the policy. Tell your broker if you go beyond Malaysia, for instance to Singapore or Thailand.

What documents help when I claim?
Delivery orders, consignment notes, photographs, a police report if relevant, and a record of how and when the goods were loaded and handed over.

Related reading

For a shorter overview, see What Does Carrier Liability Insurance Cover? and Difference Between Carrier Liability Insurance and Goods in Transit Insurance.

Hear it from David Teh

Want to hear how marine and goods in transit cover differ? Founder David Teh explains it on the Cover Buddies Podcast. Read the episode page, listen on Apple Podcasts or Spotify, or watch on YouTube.

Work with Cover Buddies Today!

If you run a haulage or lorry business and want your customer-facing cover reviewed, Cover Buddies can help. Explore Marine Insurance, get a quote or WhatsApp us.