The movement of trade across the US-Mexico border is one of the hottest topics in logistics, driven by nearshoring efforts following the US-China trade war and port congestion issues. At the Trimble Insight Conference in New Orleans, Mark Vickers, Executive VP and Head of International Logistics at Reliance Partners, stressed that if logistics companies are "not in the cross-border space, if you're not in Mexico right now, you're late".

A crucial challenge for companies expanding into Mexico is understanding liability and risk. Vickers, who helped create the Borderless Coverage all-risk cargo insurance solution, details that US companies often assume they have adequate coverage, only to find out during a claim that their global policies exclude Mexico or have prohibitively high deductibles.

The core issue lies in the Mexican cargo liability law. Historically, and currently, the law limits a carrier's responsibility based on tonnage, equating to approximately $90 per ton. For an average shipment of 40,000 lbs (20 tons), the carrier's liability is capped at roughly $1,800, regardless of whether the cargo is valued at $100,000 or $2 million. This law is rarely enforced, making it essential for shippers and brokers to secure specialized all-risk coverage.

Vickers identifies two non-negotiable elements for a cross-border risk management strategy:

1. All-Risk Cargo Insurance: Brokers and carriers should proactively offer an all-risk insurance product to shippers, accompanied by a waiver of liability if the shipper declines the coverage.‍
2. Vetted Carrier Networks: Domestic fraud protection efforts are rendered useless when crossing the border, as Mexico lacks a federal carrier database. US brokers should use a pre-vetted carrier network, like Confianza, a product developed by Carlos Cesma and Alfredo Lozano, to ensure carriers are legitimate and not associated with criminal organizations. Failure to vet carriers risks running afoul of federal laws regarding material support for foreign terrorist organizations.