Insurance for logistics companies in Singapore
What a logistics business in Singapore must insure
Two statutes apply to almost every logistics operator.
Work injury compensation. Under the Work Injury Compensation Act 2019, an employer must insure all employees doing manual work, regardless of salary. Non-manual employees earning S$2,600 a month or less must also be insured. Drivers, warehouse staff, forklift operators and packers all do manual work. Failing to insure them is an offence, with a fine of up to S$10,000, jail of up to 12 months, or both.
Motor third-party cover. The Motor Vehicles (Third-Party Risks and Compensation) Act 1960 requires third-party bodily injury cover for every vehicle used on a road. A company lorry or van without it cannot be lawfully driven.
Neither covers the goods. Customers' cargo, the warehouse and liability under contracts all need separate policies. The scale is large. MPA reported 41.12 million TEUs of container throughput in 2024, and much of it moves through local trucking and warehousing.
Covers most logistics businesses carry
| Cover | Why | Compulsory? |
|---|---|---|
| Work injury compensation | Statutory compensation for injured workers | Yes, for manual workers and non-manual staff at S$2,600 or less |
| Commercial motor or fleet | Vehicle damage and third-party claims | Third-party bodily injury yes |
| Freight forwarder or logistics liability | Liability to customers for loss of goods in your care, and errors | No; required by most customer contracts |
| Warehouse keeper's liability | Liability for customers' goods stored in your warehouse | No |
| Marine cargo or goods in transit | Loss of goods you own or contract to insure | No; required under CIF and CIP sales |
| Property and fire | Building, racking, equipment and your own stock | No; required by most landlords and lenders |
| Business interruption | Lost gross profit after fire or flood | No |
| Public liability | Injury to visitors and damage to third-party property | No |
Liability cover and cargo cover are often confused. Liability cover pays only what the operator is legally liable for, under its trading conditions. Cargo cover pays the owner's loss, whoever was at fault. The marine cargo page explains how cargo cover is placed.
Risks specific to logistics
- Liability capped below cargo value. Under the Carriage of Goods by Sea Act, which applies the Hague-Visby Rules, a sea carrier's liability is capped at 666.67 SDR per package or 2 SDR per kilogram, whichever is higher. A forwarder that contracts on wider terms than its own carriers holds the difference.
- Customers' goods in storage. A fire in a warehouse destroys stock owned by dozens of customers. The operator's property policy may cover its own racking and building, not the customers' goods.
- Road accidents. Heavy vehicles cause severe injury claims. Motor is Singapore's largest domestic insurance class, at S$1.28 billion of premium in 2025. Motor claims rose 11% while accident numbers stayed flat, so the average claim is rising.
- Theft. Electronics, tobacco and branded goods attract organised theft from trucks and yards.
- Errors and omissions. Wrong customs declarations, missed instructions and misdelivery create financial losses without physical damage.
- Manual handling injuries. Lifting, forklifts and loading bays drive WICA claims.
- Temperature control. Cold-chain failures spoil pharmaceutical and food cargo.
What moves the premium
Liability cover is priced on annual turnover or freight income, the trading conditions used, the goods handled and the limits per consignment. Operators that contract on standard trading conditions with clear limits pay less than those accepting full-value liability.
Warehouse cover is priced on the value of goods held, the building's construction, sprinklers and fire protection, and the goods stored. Combustible and high-value stock raises the rate.
Fleet is priced on vehicle numbers and types, driver age and record, routes and claims. Rising claim severity in the motor class feeds into renewal rates.
WICA is priced on wages by job type and claims history. Drivers and warehouse workers rate higher than office staff. The WICA premium guide explains the calculation.
Four controls lower rates across these covers:
- Standard trading conditions signed by every customer.
- Telematics and driver training records.
- Sprinkler and fire detection maintenance logs.
- CCTV, fenced yards and sealed-container procedures.
What the broker needs from you
A broker needs the following to obtain terms:
- Company profile: services (forwarding, trucking, warehousing, customs), licences and years trading.
- Annual turnover split by service, and freight income for forwarding.
- The trading conditions used, and any customer contracts accepting wider liability.
- Goods handled, with the highest value per consignment and per vehicle.
- Warehouse details: address, size, construction, sprinklers, racking, maximum stock value.
- Fleet list: vehicle type, age, registration and driver details.
- Headcount and wages by job type for WICA.
- Claims for the last 3 to 5 years across all covers, with causes.
- Customer contract insurance clauses, with the limits they require.
The trading conditions matter most. They decide how much of a customer's loss the operator must pay, and so how much liability cover is needed.
Frequently asked questions
Which policy covers goods in my warehouse that I do not own?
A warehouse keeper's liability policy covers your legal liability for customers' goods. It pays only if you are liable under your terms or at law. A customer wanting full cover regardless of fault needs its own stock or cargo insurance.
Does my motor policy cover goods in transit?
No. A motor policy covers the vehicle and third-party claims. Goods carried need goods-in-transit, cargo or carrier's liability cover.
What is freight forwarder liability versus cargo insurance?
Forwarder liability insurance protects the forwarder against claims it is legally liable to pay. Cargo insurance protects the owner of the goods against physical loss, whatever the cause. A forwarder may arrange cargo cover for a customer, but that cover belongs to the customer.
Do drivers need WICA cover?
Yes. Driving is manual work, so every employed driver must be insured under WICA regardless of salary. WICA covers employees, so self-employed drivers engaged as contractors fall outside it. They can buy their own personal accident cover.
Sources
General information only, not advice on any particular policy. Cover depends on the policy wording and the insurer's terms.