Managing Risk in the Consumer Goods Distribution and Logistics Industry in East Kalimantan — The Strategic Role of Insurance Brokers in Protecting the Supply Chain

East Kalimantan’s Economic Pulse Lies in Distribution

East Kalimantan is known as a region rich in natural resources—oil, gas, coal, and forest products. But beyond these heavy industries, there’s one sector that serves as the lifeblood of the daily economy: the distribution and logistics of consumer goods.

From Balikpapan to Samarinda, Bontang, Sangatta, and Berau, thousands of trucks, barges, and containers transport food, beverages, medicines, and even household goods daily. Balikpapan serves as a major transit hub, with Semayang Port and the Kariangau logistics area serving as the primary entry points for goods from Java.

However, amidst this high level of logistics activity, risks always lurk: accidents on the Balikpapan-Samarinda main highway, cargo ships sinking due to extreme weather, or storage warehouses burning down due to electrical short circuits.

For distribution and logistics businesses, these risks threaten not only physical assets but also customer trust and business continuity. This is where understanding risk management and having the right insurance coverage becomes crucial—with professional support from PT. Liberty and General Insurance Broker (L&G).

Real Risks on the Ground: From Main Road to Kariangau Port

Logistics operations in East Kalimantan are complex. Long and hilly land routes, unpredictable weather conditions, and distribution involving multiple parties increase the risks.

1. Accidents and Damage to Goods

The Balikpapan-Samarinda main route is one of the busiest in East Kalimantan. Trucks transporting basic necessities, beverages, and household goods traverse rugged terrain and steep inclines daily. Single-vehicle accidents or collisions are common, resulting in damaged or lost goods.

For example, in late 2023, a truck transporting FMCG products was involved in an accident at KM 47, causing damage to goods amounting to Rp 800 million. Without insurance, the owner of the goods would have been responsible for the entire loss.

2. Natural Disasters and Bad Weather

East Kalimantan is prone to flooding, especially during the rainy season in the Samarinda area and around the Mahakam River. Trucks and containers trapped in floodwaters risk damaging food products and electronics. Meanwhile, on sea routes, ships transporting goods from Surabaya to Balikpapan often encounter high waves, causing containers to fall into the sea.

3. Risks in Warehouses and Logistics Terminals

Besides travel, risks can also arise during storage. An electrical short circuit in a logistics warehouse can trigger a major fire. In some cases, the company’s insurance does not cover the full loss because the policy type does not match the characteristics of the goods.

4. Theft and Security Risks

The risk of theft on the highway and at ports remains a challenge. Many small logistics companies in East Kalimantan have not implemented adequate security and tracking systems.

The Impact of Losses Without Insurance: A Domino Risk in the Logistics Business

Losing large quantities of goods not only causes financial losses but can also damage business relationships. Large clients such as retailers, national distributors, and manufacturers will lose trust if their shipments are late or damaged.

In addition, indirect losses such as replacement costs, late fees, and loss of distribution contracts often far outweigh the loss of the goods themselves.

In many cases, logistics businesses that do not have Marine Cargo or Freight Liability insurance end up having to bear the costs themselves, or even being forced to temporarily close operations.

Types of Insurance that Distribution and Logistics Business Actors Must Have

1. Marine Cargo Insurance

Guarantees damage or loss of goods during transportation by land, sea or air.

Coverage can be extended to cover the risks of theft, fire and vehicle accidents.

Real-life example: A food distributor in Balikpapan partnered with PT. L&G Insurance Broker to secure “All Risks” cargo coverage for all shipments from Surabaya to Samarinda. When the ship experienced engine trouble at sea and some of the cargo was damaged by seawater, the insurance company successfully paid a claim worth Rp 450 million within 30 days.

2. Stock Insurance (Warehouse Insurance)

Protecting goods stored in the warehouse from the risk of fire, flood, theft and earthquakes.

This policy is very important for logistics operators who have depots or distribution centers in Kariangau or Samarinda Seberang.

3. Freight Forwarder Liability (FFL) Insurance

Guaranteeing the logistics company’s legal responsibility for damage or loss of client’s goods during delivery.

This policy is mandatory for companies that provide freight forwarding services, because claims from clients can be very large.

4. Motor Truck Cargo Insurance

Especially for truck fleets that transport goods between cities.

Protects goods from the risk of accidents, fire or robbery during transit.

5. Public Liability dan Employer’s Liability Insurance

Provides protection in the event of injury or loss to third parties or employees during logistics activities.

The Strategic Role of Insurance Brokers: Professional Companions for Logistics Entrepreneurs

Many logistics and distribution entrepreneurs in Balikpapan don’t understand the technical details of insurance. As a result, they often purchase policies with low premiums without realizing the limited coverage. Only then do they realize that not all risks are covered when a claim occurs.

This is where PT. Liberty and General Insurance Broker (L&G) plays a crucial role. As an independent insurance broker licensed by the OJK, L&G works in the interests of its clients, not the insurance companies.

L&G services include:

1. Risk analysis and insurance needs based on type of goods and distribution channels.
2. Negotiate with insurance companies to get the best premiums and coverage.
3. Full assistance throughout the claims process until payment is complete.
4. Annual policy audits to ensure coverage remains relevant to business conditions.

One logistics client in the Kariangau area successfully settled a claim for lost goods worth Rp 1.2 billion within two months thanks to intensive support from the broker team.

Technology and Efficiency: Brokerage Services Are Now Accessible from Anywhere

Previously, many entrepreneurs in East Kalimantan were reluctant to use insurance brokers due to distance. Now, with the support of digital technology, L&G offers online consultations, policy issuance, and claims processing.

Truck fleet owners in Kutai Kartanegara, for example, can complete the entire policy administration process through L&G’s digital system without having to visit the office. This speeds up the process and makes insurance services more transparent and efficient.

Building a Risk Management Culture in the Logistics Industry

In addition to insurance protection, it is also important to build a risk-aware culture throughout the distribution chain.

Companies need to ensure:

1. Drivers receive driving safety training.
2. Vehicles are inspected regularly and equipped with GPS tracking.
3. Items are packed with high safety standards.
4. The warehouse has adequate fire and flood protection systems.

With this approach, risks can be mitigated from the outset — and insurance becomes a final layer of protection when the unexpected happens.

1. L&G Insurance Broker also actively holds education and workshops on risk management for logistics businesses in Balikpapan and Samarinda, so they understand how to integrate insurance protection with long-term business strategies.

Conclusion: Protecting the Supply Chain, Maintaining Trust

The distribution supply chain in East Kalimantan is the backbone of the regional economy. However, this sector faces significant risks every day—from accidents to natural disasters. Without proper protection, a single incident could halt entire operations and damage a business’s reputation.

Through a professional approach and digital technology, PT. Liberty and General Insurance Broker (L&G) is ready to assist logistics and distribution players in Balikpapan, Samarinda, and throughout East Kalimantan in designing comprehensive protection solutions—from Marine Cargo and Stock Insurance to Freight Forwarder Liability.

By understanding the risks and entrusting their management to professional insurance brokers, East Kalimantan logistics players not only protect their assets and shipments, but also maintain client trust and future business sustainability.

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DON’T WASTE YOUR TIME AND SECURE YOUR FINANCIAL AND BUSINESS WITH THE RIGHT INSURANCE.

HOTLINE L&G 24 JAM: 0811-8507-773(CALL – WHATSAPP – SMS)

Website: lngrisk.co.id

Email: halo@lngrisk.co.id

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