Certified Logistics Technician (CLT) Practice Exam

When an exporter needs to insure a shipment, a certificate of insurance is crucial because it serves as proof that the shipment is covered by an insurance policy during transit. This document outlines the terms and conditions of the insurance coverage, including the scope of protection against risks such as loss or damage. Providing a certificate of insurance is a standard industry practice that assures all parties involved—including the exporter, the carrier, and the consignee—that adequate financial protection is in place for the goods being shipped.

In contrast, a bill of lading functions as a contract between the shipper and the carrier, specifying details of the shipment but not necessarily covering insurance. A commercial invoice documents the sale and provides information about the goods and their value, which is important for customs but does not pertain to insurance directly. A safety data sheet provides information on the handling and hazards of specific substances, which, while important for safety, is not related to shipping insurance. Each of these documents serves distinct purposes within the logistics and shipping process.