Picture this. A container of electronics leaves a factory in Malaysia, bound for a distributor in the Middle East. The paperwork looks right. The carrier checks out. The container is collected from the port on schedule. Nobody raises an alarm.
Two weeks later, the distributor calls to say the shipment never arrived. The carrier, it turns out, was not the carrier. Someone had created a convincing imitation, collected the cargo using falsified documents, and by the time anyone noticed, the goods were long gone.
This is not a hypothetical. It is the pattern behind a growing wave of cargo crime that is hitting businesses across Asia, and it is getting harder to spot because artificial intelligence (AI) is now being used to make the deception more convincing than ever.
What is actually happening out there?
Cargo theft has always existed. But until recently, it was mostly physical: a lorry hijacked on a quiet road, a warehouse broken into overnight, an insider slipping goods out of a container. The criminals were opportunistic. They took what was easy.
That has changed. According to the 2025 Cargo Theft Report published by TT Club, a specialist transport insurer, and BSI Consulting, a supply chain risk adviser, sea piracy incidents in the Strait of Malacca and Singapore waters rose 281 per cent year on year in the first half of 2025. Insider involvement, meaning employees or contractors who help facilitate a theft, accounted for 22 per cent of incidents globally.
The criminals operating at the top end of this are no longer petty thieves. They are organised networks that research which shipments are worth targeting, which carriers are legitimate enough to impersonate convincingly, and which points in the supply chain are easiest to exploit. Keith Lewis of risk-assessment firm Verisk CargoNet described them in May 2026 as functioning more like wholesalers than opportunists: they know what is selling, they know where the margin is, and they move quickly.
Where AI comes in
AI has given cargo criminals three new tools that did not exist at meaningful scale even three years ago.
Fake documents that look completely real.
A bill of lading is the key document in a cargo shipment. It is essentially the proof that a specific carrier has been authorised to collect a specific load. Criminals are now using AI to generate convincing fakes, complete with logos, reference numbers, and formatting that matches the real thing. They can also generate fake photographs: AI-generated images of a broken-down truck sent to a client as a delay excuse while the cargo is being redirected elsewhere. Keith Lewis described seeing this repeatedly in 2026. Proofpoint's November 2025 report documented nearly two dozen campaigns in which logistics companies were compromised this way.
Targeted attacks on the most valuable shipments.
Cargo criminals used to take what they could get. Now, with access to data analytics tools, they identify which shipments carry the highest value and the weakest security. Metals theft rose 77 per cent in North America in 2025, according to CargoNet data reported by BNN Bloomberg, largely driven by demand for copper and electronics components used in AI data centres. The criminals knew what was hot and went after it systematically.
Hijacking the digital instructions that release cargo.
This is the most sophisticated variant, and the hardest to defend against. Rather than stealing the physical goods, criminals compromise the digital systems used to authorise cargo collection. They impersonate a legitimate party in the chain, send through an authorised-looking release instruction, and collect the container before anyone realises what has happened. The Group-IB High-Tech Crime Trends Report 2026, produced by the Singapore-headquartered intelligence firm, described this as part of a shift from attacking individual targets to exploiting the network of trust relationships across an entire supply chain.
The uncomfortable truth in all three cases is the same: the cargo leaves legitimately. Someone authorised it. The paperwork checked out. By the time anyone notices, there is nothing to intercept.
So why does this matter for insurance?
Most businesses that ship goods buy marine cargo insurance, which is cover that protects the value of goods in transit from loss or damage. What many do not realise is that the type of loss matters as much as the fact of the loss.
A standard marine cargo policy is built around the Institute Cargo Clauses, which are the internationally accepted standard terms for cargo insurance. Clause A, the broadest version, covers theft. But theft in the traditional sense means goods that were taken without authorisation. When cargo is released against a fraudulent but technically authorised instruction, insurers may characterise the loss as misdelivery rather than theft, and misdelivery is treated differently under many policy wordings.
This is not a theoretical concern. It is exactly the question that gets asked when a claim is filed after a fraudulent-release loss, and the answer depends on the specific wording in the policy, not just the general category of cover.
Similarly, some cargo policies contain cyber exclusions, clauses that exclude losses where a digital system was compromised as part of the cause. These exclusions were written years ago when cargo risk and cyber risk were seen as completely separate things. In an era where criminals use hacked logistics systems to redirect physical shipments, those two risks are no longer separate at all. A business that holds both a cargo policy and a cyber policy needs to check that the two do not create a gap between them, where each policy points to the other as the one that should respond.
Why do multinationals set up their cargo programme in Singapore?
If your business moves goods across several countries, you have a choice: arrange insurance separately in each country you operate in, or set up a single programme in one place that covers everything.
Most multinationals operating in Asia choose Singapore for that central programme, and there are practical reasons for it.
Singapore is one of the world's largest marine insurance markets. According to the Maritime and Port Authority of Singapore, more than 30 marine insurers are based here, alongside over 60 licensed brokers including Lloyd's Asia syndicates. Lloyd's, the world's oldest specialist insurance market, has had an Asia office in Singapore since 1999. That depth of capacity means even complex, high-value cargo risks can be placed here.
The alternative, a patchwork of local policies across multiple countries, creates real problems in practice. Policy wordings vary by jurisdiction. When cargo moves through three countries and is lost in a fourth, it is not always clear which policy should respond, and it can take months to establish. A centralised Singapore programme, with consistent wording across all corridors, avoids that ambiguity.
The structure used is typically an open cover, which is a standing agreement between a business and its insurer. Rather than buying a separate policy for every shipment, the business declares each shipment as it occurs and the insurer applies the agreed terms and rates automatically. For a company shipping regularly across Asia, this is far more practical than arranging cover shipment by shipment.
Singapore's legal environment matters too. Most Singapore marine cargo policies are governed by English law and use the Institute Cargo Clauses as the standard wording. English law has centuries of case history on marine insurance disputes, which gives all parties a clear framework for resolving any disagreement about a claim.
What should a business actually check?
If you move high-value goods across borders, here are the questions worth asking about your current cover.
Does your policy cover fraudulent release? Ask specifically how your policy treats a loss where cargo was collected against documentation that appeared legitimate but was subsequently found to be fraudulent. The answer should be in the wording.
Are your cyber and cargo policies joined up? If a criminal compromises your logistics system to release cargo, which policy responds? Check that the exclusions in each policy do not leave this scenario uncovered.
Do your underwriters know what you are carrying? Insurers increasingly ask for specific security measures on high-value commodities such as electronics, pharmaceuticals, and metals. GPS tracking on shipments, dual authorisation before cargo release, and pre-shipment vetting of carriers are all measures that underwriters want to see in place. If these are agreed as conditions in the policy, failing to implement them can affect whether a claim is paid.
Does your policy cover your actual corridors? A policy written for Singapore-to-Europe ocean freight may not automatically cover airfreight out of Vietnam or overland trucking through Thailand. Check that the geographic and modal scope matches where your goods actually travel.
If you would like to review how your current cargo programme sits against the risk as it operates today, we would be glad to work through it with you.
This article provides general information only. It is not insurance advice. Policy availability, terms, conditions, and exclusions vary by insurer and product, and cover is subject to the full policy wording. Please contact TZY CO for advice on your specific situation.