Global logistics have become a minefield. From port delays to warehousing stress and legal risk on the roads, today’s insurance market is being stretched across every link in the supply chain. For Peter Herman (pictured), president of Insurance Marketing Agencies, that strain is now permanent.
“We’re seeing rates in shipping and all sorts of imports at higher costs,” Herman said. “Not as bad as during COVID, when there was a dramatic increase in disruption from shipping, but… there’s been a total stoppage of imports in certain places at certain times.”
Herman pointed to US tariff enforcement and poor infrastructure readiness – particularly around low-value imports – as a core driver of disruption. “The de minimis tax for products imported less than $800 has really been disruptive to businesses and to consumers as well,” he said.
The broader impact isn’t just logistical. Insurance terms, pricing models, and risk appetites are being recalibrated in real time as these shifts unfold. Coverage once seen as reliable is now under strain as insurers try to model around structural fragility, geopolitical unpredictability, and extreme inflationary pressures.
“We generally try to create programs that have adaptability for various increases and decreases in warehousing,” Herman said. “If stuff is sitting there too long, it can be a higher risk for a problem.”
He noted that US warehousing tends to have good controls in place, limiting major losses – but history shows the risk is never far from the surface. “Hurricane Sandy, we had massive disruption in warehousing facilities,” he said.
This points to a growing need for dynamic underwriting that can flex with seasonal stockpiling, tax avoidance strategies, and sudden shifts in global trade behavior.
“We’ve seen private equity get involved in litigation,” Herman said. “Instead of attorneys handling the cases themselves, they’re ganging up... but they’re selling off the risk of not getting a collection on claims.”
The result is more complex claims, more stakeholders, and higher costs. “The claims have actually gone up... largely driven by money coming in and de-escalating what attorneys have to take in terms of a risk for a win or a loss,” he said.
That financial backing has fundamentally altered claim dynamics – stacking the odds against fleet operators already struggling with compliance, safety mandates, and shrinking coverage options.
“I don’t think we’ve seen a lot of flood damage on trucks unless they’re stopped at locations which might be vulnerable,” he said. “But definitely the environment changes and storm damage have a measurable impact and measurable change.”
Insurers are increasingly relying on fleet managers to take the lead on mitigation. “A lot of truckers are implementing better safety standards, whether they’re putting in cameras or systems for tracking the trucks,” Herman said. “They can better anticipate hazardous locations that they might have to travel through.”
Among emerging threats, the most severe may be digital. Herman said cyber risk is no longer hypothetical – it’s constant.
“Our agency has seen a vast increase in the number of cyberattacks,” he said. “It’s not a matter of if or not, it’s a matter of when and how often.”
He recalled a meeting with a food distribution client who made a point mid-conversation – by tapping his finger repeatedly on the desk.
“I said, ‘What were you doing?’ He goes, ‘I’m showing you how many times our system is attacked while we’re having this conversation,’” Herman said.
The surprise, Herman admitted, came from how aggressive those attacks were on even low-profile industries. “I was like, ‘Okay, what kind of cyberattack is somebody importing bagels and food?’ It’s constant,” he said. “They’re trying to take our systems down. They’re trying to disrupt us.”
Even the claims process has changed. “You call it into a carrier for a claim, and they’re like, ‘Oh yeah, I know that group. I’ll call them right now,’” Herman said. “They negotiate the settlements on ransomware much more effectively.”
Yet for all the tools in place, there’s still a sense of exposure. “No matter how much you’re spending, you always feel like you’re not spending enough,” he said.
