Carrier liability refers to how a carrier is responsible for lost, damaged, or delayed freight. For LTL freight shipments, carriers determine their liability on a dollars-per-pound basis depending on freight class, packaging, commodity type, and other factors. Freight class is the most common determining factor dictating carrier liability, and coverage typically ranges from around $1-2 per pound for lower freight classes up to $25 per pound for the highest freight classes.
There are five exceptions to carrier liability, outlined in The Carmack Amendment, a law passed in 1935 to clarify what constitutes a legal liability freight cargo and damage claim against a carrier:
– this protects the carrier from liability in the event of a natural disaster or physical anomaly. It does not apply to naturally occurring events that can be predicted, such as severe weather.
– this protects the carrier from liability should damages be inflicted by a foreign enemy of the United States, whether it be an act of war or terrorism.
– this protects the carrier from liability if damages are the shipper's fault, including instances where the cargo has not been loaded or secured, there is insufficient packaging, or the contents of a shipment are mislabeled. Should there be any conflict regarding the details of these occurrences, the BOL (bill of lading) is the overriding document.
– this protects the carrier from liability in the event of government actions, such as road closures, trade embargos, or product recalls that can cause cargo damages or delay/impact shipments.
– this protects the carrier from liability regarding temperature-controlled shipping of perishable products. If the carrier takes the necessary action to prevent delays and the goods still become damaged, the carrier cannot be held liable.
For a carrier to be liable for damages that occur during shipping, the shipper must be able to prove that the goods in the shipment were undamaged when given to the carrier, prove that the goods arrived damaged or not at all, and be able to provide the amount of the damage claimed. Basically, carrier liability covers a limited dollar amount for only a fraction of the possible damages that can occur during shipping, and only if those damages are a direct fault of the carrier. If what you are shipping is sturdy and not of high value, carrier liability may be enough coverage. However, if you are shipping anything fragile, unique, or valuable, it is recommended that you consider purchasing additional freight insurance.
To ensure that your valuable items are covered in the event of unforeseen damage or loss due to inadequate packaging, temperature, shifting cargo, natural disaster, theft, motor vehicle accidents, or any other possibility that can occur during shipping, it is recommended that you purchase additional freight insurance (often called cargo insurance) from a third party.
When looking for additional freight insurance, the first things to examine are deductibles and limits. The deductible refers to the maximum amount you will have to pay out of pocket for damages to your cargo. The higher the deductible, the lower the cost for your insurance policy. The limit refers to the maximum amount the insurance provider will pay for damages to your shipment. The higher the limit, the more expensive the insurance policy. It is important to look at different third-party freight insurance policies and providers, taking into consideration the value of your shipment, the cost of the deductible against the price of the premium, and whether the insurance limit will cover the shipment's total value in order to determine which policy is suitable for your needs.
Obtaining a third-party insurance policy for your valuable freight is the best way to secure full coverage for the goods you are shipping. The next step is knowing when and how to file a liability or insurance claim in the event of damage or loss to your shipment. When dealing with damaged freight, it is critical to identify and record the damage as soon as possible at the time of delivery. It is crucial to ensure that the consignee thoroughly inspects all items at the time of delivery, and any damage is noted in detail on the Proof of Delivery form. Take pictures of the damage, if possible. It can be challenging to file a successful claim without proper evidence, so it is critical to document the damage immediately to prove that it occurred while the cargo was in transit. Once the damage is assessed and recorded, a claim can be filed with the carrier and the insurance company for the cost to repair the item or for the entire price of the item. If the shipment is lost, a carrier will typically spend a week or so tracing the path of the shipment to try and locate it. If the shipment cannot be found, the carrier will declare the shipment officially lost, and you can begin the process of filing a claim for the total cost of the item.
To file your liability or insurance claim, you will need a claim document from your carrier or third-party insurance. You will also need an invoice for the damaged or lost goods that includes the manufacturer's total cost of the items or the repair cost to fix the damages. You will also need any photos taken by the consignee upon delivery and the signed Proof of Delivery form that notes the damages. Submitting your claim document with the appropriate invoice, photos, and POD will ensure that your claim is accepted, processed, and paid out in the fastest time frame possible.
Carrier liability refers to how a carrier is responsible for lost, damaged, or delayed freight. For LTL freight shipments, carriers determine their liability on a dollars-per-pound basis depending on freight class, packaging, commodity type, and other factors. Freight class is the most common determining factor dictating carrier liability, and coverage typically ranges from around $1-2 per pound for lower freight classes up to $25 per pound for the highest freight classes.
There are five exceptions to carrier liability, outlined in The Carmack Amendment, a law passed in 1935 to clarify what constitutes a legal liability freight cargo and damage claim against a carrier:
– this protects the carrier from liability in the event of a natural disaster or physical anomaly. It does not apply to naturally occurring events that can be predicted, such as severe weather.
– this protects the carrier from liability should damages be inflicted by a foreign enemy of the United States, whether it be an act of war or terrorism.
– this protects the carrier from liability if damages are the shipper's fault, including instances where the cargo has not been loaded or secured, there is insufficient packaging, or the contents of a shipment are mislabeled. Should there be any conflict regarding the details of these occurrences, the BOL (bill of lading) is the overriding document.
– this protects the carrier from liability in the event of government actions, such as road closures, trade embargos, or product recalls that can cause cargo damages or delay/impact shipments.
– this protects the carrier from liability regarding temperature-controlled shipping of perishable products. If the carrier takes the necessary action to prevent delays and the goods still become damaged, the carrier cannot be held liable.
For a carrier to be liable for damages that occur during shipping, the shipper must be able to prove that the goods in the shipment were undamaged when given to the carrier, prove that the goods arrived damaged or not at all, and be able to provide the amount of the damage claimed. Basically, carrier liability covers a limited dollar amount for only a fraction of the possible damages that can occur during shipping, and only if those damages are a direct fault of the carrier. If what you are shipping is sturdy and not of high value, carrier liability may be enough coverage. However, if you are shipping anything fragile, unique, or valuable, it is recommended that you consider purchasing additional freight insurance.
To ensure that your valuable items are covered in the event of unforeseen damage or loss due to inadequate packaging, temperature, shifting cargo, natural disaster, theft, motor vehicle accidents, or any other possibility that can occur during shipping, it is recommended that you purchase additional freight insurance (often called cargo insurance) from a third party.
When looking for additional freight insurance, the first things to examine are deductibles and limits. The deductible refers to the maximum amount you will have to pay out of pocket for damages to your cargo. The higher the deductible, the lower the cost for your insurance policy. The limit refers to the maximum amount the insurance provider will pay for damages to your shipment. The higher the limit, the more expensive the insurance policy. It is important to look at different third-party freight insurance policies and providers, taking into consideration the value of your shipment, the cost of the deductible against the price of the premium, and whether the insurance limit will cover the shipment's total value in order to determine which policy is suitable for your needs.
Obtaining a third-party insurance policy for your valuable freight is the best way to secure full coverage for the goods you are shipping. The next step is knowing when and how to file a liability or insurance claim in the event of damage or loss to your shipment. When dealing with damaged freight, it is critical to identify and record the damage as soon as possible at the time of delivery. It is crucial to ensure that the consignee thoroughly inspects all items at the time of delivery, and any damage is noted in detail on the Proof of Delivery form. Take pictures of the damage, if possible. It can be challenging to file a successful claim without proper evidence, so it is critical to document the damage immediately to prove that it occurred while the cargo was in transit. Once the damage is assessed and recorded, a claim can be filed with the carrier and the insurance company for the cost to repair the item or for the entire price of the item. If the shipment is lost, a carrier will typically spend a week or so tracing the path of the shipment to try and locate it. If the shipment cannot be found, the carrier will declare the shipment officially lost, and you can begin the process of filing a claim for the total cost of the item.
To file your liability or insurance claim, you will need a claim document from your carrier or third-party insurance. You will also need an invoice for the damaged or lost goods that includes the manufacturer's total cost of the items or the repair cost to fix the damages. You will also need any photos taken by the consignee upon delivery and the signed Proof of Delivery form that notes the damages. Submitting your claim document with the appropriate invoice, photos, and POD will ensure that your claim is accepted, processed, and paid out in the fastest time frame possible.
