The Total Insured Value (TIV) is the total value being insured under a cargo insurance policy. Flexport calculates TIV based on the following formula for clients who purchase cargo insurance through us:

Total Insured Value = (Commercial Invoice Value + Freight Charges)*1.1 + Customs & Duties Fees

• The Commercial Invoice (CI) value is the value of the goods the buyer has paid to the supplier as evidenced by the CI.
• The Freight Charges represent the total cost of freight for the shipment’s journey, including all origin and destination charges with some exceptions (e.g., detention and demurrage charges).
• The Customs & Duties fees represent any applicable fees assessed on a shipment’s exit or entry into a country as well as any applicable filing fees charged.
• The 10% uplift on the Commercial Invoice Value + Freight Charge portion of the calculation is to capture any market price fluctuations or unforeseen administrative expenses that occurred between when the goods were purchased from a supplier through to resolution of any claim.

Each of the above components are insurable and represent the maximum amount to be paid out in the event of a legitimate claim, subject to the terms and conditions of the insurance policy. While Flexport verifies each individual calculation component individually before quoting the resulting premium amount, it’s important that if you work with another coverage provider that you size your TIV accurately to reflect the true value of the shipment as under-declaring TIV could result in insufficient monetary compensation in the event of a loss event.