Strategic cargo theft drives underwriting pressure in logistics insurance
Cargo theft is now more sophisticated, more organized, and more costly. As a result, insurers are responding by tightening underwriting scrutiny and demanding stronger controls from logistics firms.
Data suggests the scale of the threat has grown rapidly. Analysis from Verisk’s cargo security division, CargoNet, found that estimated cargo theft losses surged nearly 60% to about $725 million in 2025, even though the total number of incidents remained relatively stable at roughly 3,594 supply-chain crime events across the US and Canada.
The rising cost of theft reflects a shift toward more targeted and strategic operations. The average value per theft climbed 36% to roughly $273,990, highlighting how organized groups increasingly focus on higher-value shipments.
According to Marsh North American logistics practice leader Janelle Griffith (pictured), the shift from opportunistic theft to coordinated criminal activity has been developing for nearly a decade, accelerating during the pandemic as both legitimate supply chains and criminal networks embraced digital tools.
“What used to be more opportunistic, traditional theft has evolved into highly organized and structured operations,” Griffith said. “Today’s cargo theft is often strategic, coordinated, and technology-enabled rather than simply someone stealing a load. In many cases, criminal groups carefully plan when and where to intercept shipments, often exploiting specific weaknesses in supply chain processes.”
Griffith said a key vulnerability lies in the fragmented nature of modern supply chains. Multiple parties – shippers, freight brokers, carriers, warehouses, and consignees – all interact with cargo during transit, creating multiple handoff points where fraud or theft can occur.
“As much as we use technology to help with our levels of visibility, the levels of visibility into the supply chain are still lacking,” Griffith pointed out. “You have lots of people along that line… At every single point, the control and custody change.”
Without a clear end-to-end system of identity verification and cargo control, criminals can exploit these transitions. Industry studies show these vulnerabilities are increasingly exploited through cyber-enabled tactics such as identity fraud, fraudulent carriers, and document manipulation.
While high-value and cross-border shipments are frequent targets, theft patterns have also broadened. Criminals increasingly steal goods that are easy to resell or difficult to trace, such as grocery items or household goods. Once those products enter informal markets or are consumed, they are virtually impossible to track.
At the same, emerging technology is ramping up theft sophistication. “We’re seeing more cases of email spoofing and domain impersonation,” said Griffiths. “For example, attackers may slightly alter a legitimate company’s domain name — changing or adding a single letter — to create emails that appear authentic.
“(Freight) brokers who have worked with a carrier before may not immediately notice the difference. Because these tactics constantly evolve, the industry often feels like it is playing catch-up.”
As losses mount, insurers are taking a closer look at how logistics companies manage theft risk. Griffith said they are introducing tighter underwriting standards and greater scrutiny during renewals.
“For freight brokers, that often includes thorough carrier vetting and, in some cases, verification of the individual driver assigned to a shipment,” she said. “For warehouses and distribution facilities, insurers want to understand pickup protocols. Facilities should confirm the identity of drivers and companies collecting cargo rather than relying solely on shipping documents, which could potentially be altered.”
In some cases, insurers are also imposing sub-limits on certain types of theft exposures, particularly those linked to organized crime tactics.
Despite the escalating threat, Griffith believes stronger coordination across the logistics ecosystem can reduce losses. Technology, including tracking sensors, authentication systems, and transportation management controls, plays a key role, but it must be paired with human oversight.
Ultimately, companies seeing the most success are those integrating technology, operational discipline, and collaboration with authorities. Those improvements ultimately translate into better insurance outcomes.
“Collaboration is key,” Griffith stressed. “Where you can have things like full chain of custody documentation, that significantly cuts down on the level of strategic theft. As brokers, we can then take that back to the insurers and say, ‘This is what this particular client is doing.’ You absolutely see all of their effort translate into reduced insurance pricing because they are a safer risk.”
