Jewellery trade gets an insurance shock

122
Jewellery trade gets an insurance shock

This was evident when a logistics company official last week ran away with 11 kg of gold jewellery worth Rs 3.5 crore.

Jewellery firms beware. Cases of logistics company officials decamping with precious cargo while in transit or goods disappearing while left unattended by a logistics provider are not covered under the jeweller’s block insurance policy, which covers transit-related risk like theft, robbery, burglary, etc.

This was evident when a logistics company official last week ran away with 11 kg of gold jewellery worth Rs 3.5 crore. “The owner of the jewellery firm was entertained neither by the insurance company nor the logistics provider,” said Surendra Mehta, national secretary, India Bullion & Jewellers Association (IBJA).

While the police recovered 10 of the 11 kg, the news of jewellers’ block insurance policy not covering “infidelity” — dishonesty by logistics company employees and /or gross negligence of logistics companies — loss due to unattended vehicles, the mysterious disappearance of goods — has shocked the trade.

“Many only now realise that if goods disappear while in transit because of infidelity or unattended vehicles, the extent insurance policy doesn’t cover such loss,” said Bhavesh Kataria whose firm, Kataria Jewellery Insurance, is the largest insurance broker for the trade, counting clients like Senco, PN Gadgil and Royal Chains.

Kataria said the solution lies in the logistics company taking a fidelity policy for their employees or a jeweller taking a third-party fidelity policy which will cover logistics company, goldsmiths and other third parties, their employees and contractual employees. However, he added, for the negligence of logistics company – disappearance from unattended vehicle – the logistics company has to compulsorily have a carrier’s legal liability insurance policy, there is “no feasible insurance cover a jeweller can take in such a case.”

Mehta said jewellers will now insist on logistics companies having such a cover before sending goods for exhibitions and transfer from branches.

Follow TJM on Instagram: @TheJewelryMagazine

Disclaimer: This information has been collected through secondary research and TJM Media Pvt Ltd. is not responsible for any errors in the same.

LEAVE A REPLY

Please enter your comment!
Please enter your name here