Piracy on the Open Road: Cargo Theft & Insurance Coverage

Cargo theft is on the rise. Between 2021 and 2024, cargo theft incidents increased more than 90%. In 2025, cargo theft cost the freight industry nearly $725 million. It is well known that the cargo theft industry has shifted from a small family operation into an industry dominated by organized crime. This has resulted in more focused thefts of high-value cargo. In fact, the average theft value was $273,990 in 2025.

Unfortunately, there is no indication that the amount of cargo theft will decrease any time soon. Despite more calls to action, if anything it is likely that the rate and/or value of cargo theft will continue to increase in the future. So, what can a freight carrier do to protect itself in these difficult times?

Recognize What Cargo is Most at Risk

Food and beverage products experienced the largest increase in thefts, with 708 thefts occurring in 2025. Meat and seafood products and tree nuts were particularly affected, with trends varying by region, meat and seafood were heavily targeted in the Northeast, especially New Jersey, while tree nut thefts were more common on the West Coast. Metal theft rose 77%, likely driven by ongoing demand for copper products.

However, theft of consumer-grade electronics (think televisions and personal computers) declined. Instead, cargo thieves focused their efforts on enterprise computer components and cryptocurrency mining hardware. Vehicle related products, tires, auto parts, and motor oils, also continue to be attractive for cargo thieves.

Where Cargo is Most at Risk

Cargo is unequivocally most at risk near the major logistics hubs. California alone represented 38% of all recorded cargo theft incidents last year while Texas ranked second with 20% of total thefts. Together they accounted for more cargo thefts than the next four states combined, Tennessee (11%), Illinois (7%), Pennsylvania (7%), and Georgia (4%).

Urban areas with the highest rates of stolen trailers and trailer pilferage include Los Angeles, Dallas-Fort Worth, Atlanta and New York. Cities experiencing recent cargo theft spikes include Chicago, Memphis, Houston, Miami, Savannah, Ga., and Newark, N.J.

What Kind of Cargo Theft is Occurring?

Traditional cargo theft (think breaking locks and stealing trailers) still constitutes approximately 60% of all cargo theft. However, email scams, double brokering scams, fake identities, and other non-violent methods (dubbed "Strategic Cargo Theft") is on the rise, comprising between 35%-40% of all cargo theft, as opposed to 5% only a few years ago.

This paints a clear picture: cargo is most at risk near major freight and logistics hubs in large cities.

Being cognizant of the risks of cargo theft does not mean that it won't happen to you. So, what is a freight operator to do?

Insurance Options

Insurers catering to the freight industry have created a number of specialized products targeting specific risks.

Cargo Insurance:

Cargo Insurance is a form of property insurance sometimes called "all risk" because it covers all perils except those specifically excluded, and is typically obtained by shippers to protect goods in transit. Some carriers offer insurance products further tailored to the type of party, risk, or goods being shipped, allowing shippers who handle high-value loads to obtain additional peace of mind. Given the rise in Strategic Cargo Theft, brokers may also consider contingent cargo loss insurance, which helps protect brokers when the shipper’s cargo insurance policy does not cover a loss and the manufacturer turns to the broker to pay.

Small, independent operators may also be interested to know that some carriers offer independent cargo insurance.

When considering a cargo insurance policy, it is vital to review the conditions of coverage and exclusions. Cargo policies may require the policyholder to implement certain security measures to protect the shipment or pack the shipment in a certain way and may exclude some shipments, notably high-value goods or goods that thieves often target. We cannot stress enough how important it is to review potential goods and exclusions. After all, what good is cargo insurance that does not cover the cargo you are shipping?

Cyber Insurance:

Cargo thieves are increasingly technologically savvy, using AI and other digital tools to impersonate shippers and brokers. Cyber insurance may cover costs incurred when thieves access credentials or digital information and then use that information to scam third parties. It could also cover costs to expel intruders from company computer systems or pay to recover data ransomed by thieves. Cyber policies are often custom and negotiated on a policyholder-by-policyholder basis, so as with Cargo Insurance, carefully review the extent of coverage, conditions, and exclusions before purchasing a policy.

Cargo theft causes significant loss in profits, extra expenses, and supply-chain disruptions. Freight carriers should ensure they can protect against these events and resultant losses. Policyholders should carefully review their existing insurance policies to determine which coverage exists, and whether additional or modified terms are warranted in the event of a cargo-related loss.

If you or your company need help navigating the fallout of a cargo-related theft, translating an insurance policy, or otherwise protecting your business, please contact Sean Barrick (sbarrick@setlifflaw.com) at (804) 377-1276, or Steve Setliff (ssetliff@setlifflaw.com) at (804) 377-1261.