Shortages, Damages, And Claims For Freight Shipments

Whenever freight shipments are being moved, it is inevitable that, even with the best carriers, shipments can wind up delivering short or damaged. It is just a part of the business when tons and tons of freight are being moved around. When this does happen and you have to file a claim to get compensation, it has to be treated with the same amount of attention and provided evidence as for when you are disputing a reclassification or a reweigh. Just as filing a dispute with a carrier is akin to going into court, basically, the same rules apply to file a freight claim. It is possible to gain findings in your favor but you still must proceed with a claim in the same manner as you would a dispute.

Don’t sign a freight shipment until you inspect

One of the most common errors that are made which negates a shortage/damage claim before it ever is filed is when shortages or damages are not noted on the BOL (Bill of Lading) or POD (Proof of Delivery) at the time the shipment is delivered. The carrier arrives with the freight, the consignee signs for it, the carrier departs, and then the freight is inspected and is found to be either short or damaged. And, by the same token, the flip side of that coin is when a shipment is picked up and the driver is not instructed to sign the BOL and notate the pallet and carton/box/case count on those pallets as listed on the BOL. However, what will negate most claims before they ever begin is on the delivery side when shortages and damages are not notated at the time of delivery by the consignee. When this happens, most any and all claims filed under that circumstance are denied almost instantly. The one recourse is that the carrier is alerted immediately after the delivery and they send a representative out to the delivery site to inspect the freight and make their own determination if the items were damaged during shipping or if actual shortages occurred. This must be carried out within three business days of the actual delivery. If the damage is actually notated on the BOL at the time of delivery then you may have up to eight months to file the claim through Ship or the freight carrier.

Related Reading: What is a Bill of Lading (BOL)?

Make sure your shipment is covered

Whenever you are quoting a shipment and making your BOL, you will be prompted to state what the insured value of your shipment is. Be advised this is not the retail value, but just the replacement value. Before your shipment is dispatched, Ship Customer Support will examine the insurance value and make sure that the carrier whom you selected has a corresponding level of liability insurance that will cover the value that you stated. In the event that the carrier’s level of liability insurance is not adequate, Ship Customer Support will be in touch with you promptly to alert you to this fact and suggest a carrier of equal capability and transit time, but who also carries the appropriate amount of liability insurance. However, this can often mean that the price of the shipment will go up due to the amount of insurance needed but this can be mitigated. If no carrier has an adequate amount of liability for the shipment, Ship Support can purchase additional third-party insurance on your behalf to make sure that your shipment is covered. Most shipments can generally be covered for somewhere in the neighborhood of $25-$50 depending on the amount of insurance needed. Also, a deductible may apply on certain shipments. Also, you should be aware that a carrier’s tariff will limit the amount of liability they can provide when the shipment meets one of the following qualifications.

1. Volume Shipments
2. Improperly packaged goods
3. Internet auction items
4. Used or reconditioned items
5. Furniture
6. Items of extraordinary value
7. Freight with packaging that exceeds 10 feet in length, width or height
8. Items that require prior written approval by the carrier

Proper packaging is critical and a carrier may not be liable for cargo that is not properly packaged. Goods should be packaged in accordance with NMFC packaging rules for commodity and packaged in accordance with industry standards to withstand the rigors of transportation.

Related Reading: What is an NMFC Number?

How to file your claim

Once you have determined that a shipment was indeed damaged or shortened, you have your signed BOL and POD documenting as such, as well as your photographs, proof of commodity and every other piece of evidence necessary, Ship Customer Support will walk you through the claims process. Fortunately, we are able to process and manage the claims on your behalf with the carrier as we have our own claims team. All you would have to do is fill out a simple form, and send it back with all of the documentation that you have to provide and then await resolution on your claim.

Patience is a virtue

Once your claim has been filed be prepared to play the waiting game because it can take a while. A higher rated carrier will often acknowledge and resolve a claim within a period of 30 to 60 days.  A lower rated carrier can take up to 120 days to acknowledge that a claim has been filed and at that point getting a resolution on a claim can take up to a year. Choosing a carrier is an important decision and extends further than just transit times.