June 6, 2023

Mexico cargo theft is a pain point for shippers – what can you do to mitigate your risk?


Cargo theft and trailer disappearance in Mexico have long been significant challenges for shippers and logistics service providers involved in cross-border operations. Reliance Partners, in collaboration with Schneider, recognizes the urgency to address this issue from a risk management perspective. As the trade between the United States and Mexico continues to grow at record rates, cross-border risk management has become a crucial consideration for CEOs and Risk Managers engaged in Mexico trade.

Mexico faces over 17,000 reported incidents of cargo theft each year, with many cases going unreported due to the country’s low liability limitation law. Unlike in the United States, where coverage can reach at least $100,000, Mexico’s liability is limited to a meager amount equivalent to 15 days of the minimum daily wage. This translates to only about $1,250 in coverage for an average 40,000-pound trailer. The implications are striking, as it means substantial losses for shippers, especially in cases of total load loss.

To mitigate these risks, shippers must consider implementing All-Risk full value Borderless Coverage provided by Reliance Partners. This coverage ensures that the value of shipments is adequately protected, unlike the limited liability provided by Mexican regulations. Without such coverage, shippers can experience significant financial losses, as the coverage amount does not increase even if the load value does.

Certain regions in Mexico have become notorious hot spots for cargo theft, including non-toll highways in Puebla, Tlaxcala, Jalisco, Veracruz, Guanajuato, Michoacan, Guerrero, and Nuevo Leon. The state of Mexico leads the list of stolen tractor-trailer units, followed by Puebla, Veracruz, Guanajuato, and Jalisco. The most commonly stolen commodities include fuel, auto parts (with tires being the most targeted), electronics, liquor, consumer goods, and metals (with steel being the top choice).

Reliance Partners, in partnership with Schneider, offers the Borderless Coverage program designed specifically for top cross-border motor carriers, logistics service providers, and shippers. This program provides insurance and risk management solutions tailored to the unique challenges of cross-border operations. Schneider and Reliance Partners collaborate to deliver comprehensive cross-border risk management tools, filling the gaps that traditional logistics service providers often struggle to address effectively.

Key offerings from Schneider’s cross-border services include:

  1. All Risk Shipper’s Interest Cross-Border Cargo Insurance, inclusive of theft from pickup in Mexico until delivery in the U.S. This primary policy, provided through Reliance Partners, offers low deductibles and ensures coverage aligned with the specific risks faced in Mexico.
  2. Real-time shipment tracking across all modes, encompassing in-cab, on-trailer, and in-cargo tracking options. Shippers are encouraged to opt for this service in Mexico to enhance visibility and security.
  3. Dedicated capacity solutions that allow shippers to contract Schneider’s equipment and drivers for consistent, long-term routes.
  4. Intermodal capacity solutions available throughout Mexico’s manufacturing belt, offering enhanced security as freight moves without stopping and is often transported in two stacked containers on the railroad.

Schneider’s Mexico Risk Management team works closely with shippers’ risk management departments to identify challenges, implement effective solutions, and adapt as supply chains evolve. To read Schneider’s full article on Mexico’s cargo theft click here.