A Long and Winding Road

What’s the story: Loss and damage happen when you ship goods. It’s not a matter of it, but when. How you protect your in-transit goods can determine the ease in which claims are paid.

Why it matters: In 1935, Congress enacted the Carmack Amendment. Adopted to achieve uniformity in rules governing interstate shipments, the Amendment — even today — spells out rights, duties and obligations of shippers and carriers when it comes to cargo claims. However, it doesn’t guarantee insurance coverage, or necessarily make winning a claim easy.

Storms. Fires. Accidents. Theft. Inadequate packing by a vendor. Suspected mishandling. Or just plain bad luck. In the event of a lost or damaged shipment, you may quickly discover all the gaps and loopholes in—and limits of—carrier liability. And even if you’re due compensation, you may only get pennies on the dollar. Not to mention legal fees you may have to incur to “win.”

Five exceptions that may relieve the carrier of liability:

• Act of God
• The public enemy or act of war
• Act or default of shipper
• Inherent vice or nature of the goods transported
• Public authority

How are you protecting your goods?

Every now and then bad things happen to good cargo and you might be in for an unpleasant surprise.

While carrier liability can be a perfectly good way for some shippers to protect their goods in transit, it’s simply not insurance. Understand what the carrier will pay in the event of a claim and consider the impact a loss can have on your bottom-line.

Some shippers think their commercial insurance policy has them covered. However, unless you’ve added a specific endorsement in the policy to cover shipping, it may not cover your losses.

Consider an all-risk insurance policy offered through UPS Capital Insurance Agency, Inc. It’s a superior risk risk-mitigation alternative to carrier liability or a commercial insurance policy. Here’s how:

• It’s true protection for your bottom line. You’re covered up to the full sales value of your goods.
• It’s a real insurance policy. Customized for your unique business, not a one-size-fits-all program, like carrier liability.
• It will likely cost you less than carrier and excess liability. Seriously.
• The claims process is simple and fast. Submit and manage claims online with claims paid in days not weeks.
• It can be a business expense. That can make it tax deductible.
• It’s flexible. Coverage can be expanded to include your warehoused inventory.