Time to test your logistics suppliers contract clauses

In a higher geopolitical-risk environment (Mexico and globally), insurers are tightening policy terms and limits. This directly impacts negotiations and contracts with logistics providers. Are you ready to review whether your clauses actually cover what you want and need?

Here are a few key examples to watch:

• Premium adjustment clause: “Premiums may be adjusted annually to reflect changes in geopolitical risk exposure and market conditions, with at least 30 days’ prior notice and a joint review between the parties to agree on the new amount.”

• Mitigation plan: “The parties agree to implement security and monitoring measures, including GPS/satellite tracking, escorts when applicable, and incident response protocols, to reduce the likelihood of losses and facilitate claims.”

The trend toward higher premiums and the cancellation or exclusion of risk coverage reflects a market response to greater uncertainty, insecurity, and rising costs.

Companies must adapt through risk planning, diversification of logistics providers, and clearer, modular insurance arrangements.

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