Insurance is certainly a hot topic in logistics these days. Increased rates for airfreight carriers contributed to the emergence of security surcharges at most major airlines which are being passed to shippers. A recent survey by the American Trucking Associations (ATA) found that trucking companies renewing insurance policies saw rates skyrocket after Sept. 11. And not surprisingly, commercial ocean shipping companies have been having trouble getting reasonable insurance rates for their Middle East operations since Sept. 11, and passing surcharges on to shippers.

But now those companies have an option, courtesy of Uncle Sam. The Transportation Department's Maritime Administration recently announced the DOT will underwrite war risk insurance for U.S. flag vessels and those owned by U.S. companies that cannot get commercial insurance at a reasonable rate for operations in the covered regions. The insurance covers cargo, ships and crew and is also available to ships that are of security interest to the U.S. working in the region.

dhannon@cahners.com