What key role does cargo insurance play in air transport?

Cargo insurance plays a crucial role in air transport by providing protection against potential losses or damages that may occur while the cargo is in transit. This coverage ensures that both the shipper and the consignee are financially safeguarded against risks such as theft, accidents, or unexpected events that could lead to loss or damage of the cargo.

In the dynamic and often unpredictable environment of air transport, having insurance is vital for mitigating financial risks. It allows shippers and recipients to have peace of mind, knowing that they have recourse in the event their goods are compromised during handling or transportation. This comprehensive protection is essential for maintaining confidence in shipping operations and facilitating international trade.

The other options address different aspects of air transport but do not align with the primary purpose of cargo insurance. For example, securing extra space for cargo is a logistical consideration rather than a function of insurance. Similarly, reducing shipping costs and providing communication between shipper and airline are also important in the logistics process, but they do not pertain to the protective role of insurance in safeguarding cargo.