It has been said that the one area that most shippers are the most uncomfortable and confused with is navigating claims for cargo loss and damage. However, this does not mean that understanding the process of freight claims isn’t imperative to running an efficient business. Here are 5 tips to make sure that your freight claim experience is as fast and efficient as possible:
1. Give Carriers Time
Carriers are allowed up to 30 days from the date of the claim submission to acknowledge that they received the claim, and then up to 120 days after that to investigate the claim. The National Motor Freight Traffic Association (NMFTA) also allocates carriers an additional 60 days after the initial 150 days, if they haven’t come to a decision, as long as they provide written status updates. A way that you can make sure to track the status of the claim is to set calendar reminders every 15-20 business days to check in.
2. Provide Additional Information
Throughout the freight claim process, there will most likely be multiple people reviewing a claim, especially for shipments of high-value. One person may recognize something that another person missed, and they may need extra information from you to properly investigate. These requests can come any time within the 150 day process, and time is paused when the carrier sends out an inquiry. Sometimes, a phone call to the carrier is all that’s needed to clarify the inquiry.
3. Complete All Work Before Submitting the Claim
Because the freight industry moves so rapidly, it’s very easy to assume that if a claim isn’t submitted just as fast, it could slow down the process. In reality, the best thing to do is to collect all the necessary documentation, inspect the goods immediately and make sure this shipment is in the hands of the consignee or shipper before submitting your claim. You’ll save a ton time by preparing for what the carrier may need during their investigation. Legally, a shipper has nine months from the date of delivery to provide a formal cargo claim to the carrier.
4. Mitigate Your Products
This is a fancy way of saying the shipper must do 3 things: salvage, discount or repair the commodity. If you can fix a $10,000 machine for $100, it’s better to make the repairs and file a claim for the cost of the repairs. Remember to first ask the carrier to inspect the products, and be upfront with them that you may mitigate before continuing with the freight claim.
5. Opt For Insurance
Unless it is otherwise stated in your contract with a carrier and 3PL, every LTL shipment falls under the carrier’s limits of liability. The liability limits may be based on class/weight, products and whether the product is new or used. The carrier may pay per general maximum liability or decline the claim entirely because the products are listed on their “restricted/excluded” list. Purchasing shippers interest insurance confirms that your products are covered at the invoiced value, and are not limited to tariffs.
Going through the freight claims process doesn’t need to be a stressful or confusing task. With the right amount of planning and keeping these guidelines in mind, you’ll avoid most freight claim problems while saving a countless amount of time and money simultaneously.