Different insurance options mean that different methods are called for when making a claim. Insurance claims for freight transport remain rare. However, variables such as adverse weather can mean that issues arise. The cost of claims is covered by either carrier liability, cargo insurance, or both. There are distinct differences between the two. When deciding which to use, these are the factors to consider in the claims process.
Claims related to damage or theft usually need to be made within nine months of delivery. Although this sounds like a large window, it can be deceptively small. And it is a window that can become rapidly smaller: some carriers require immediate notification, so make sure that you check in advance.
The timescale is often fine if you’ve got agents in major European ports, but can be a challenge when shipping to an outpost in the Arctic Circle.
Time Goes Both Ways
Both sides are limited by time. Once a claim is made, the carrier has to act rapidly. They have 30 days to provide receipt of the claim, and 120 days to mount a response. That response falls under stringent legal jurisdiction that gives the carrier multiple grounds to contest the case.
Most carriers will do everything in their power to protect themselves from such claims. No company wants to violate their client’s trust, so weak links – such as ports with poor security, or third parties with dubious records – are eradicated well ahead of time. For instance, at NTEX we use our local knowledge to plot the safest and most reliable routes. However, carriers will look at each claim closely to determine their responsibility.
Show The Proof!
In carrier liability cases, it is the client who has to demonstrate proof of damage. This protects companies from spurious claims by fraudsters, which would send everyone else’s costs sky-rocketing.
Be aware that if multiple shipping partners are used, the point of damage needs to be established precisely. Liability insurance only works if it can be established when damage occurred, and what the damage value is. This places a burden of responsibility on various parties to prove their innocence.
What About Cargo Insurance Claims?
Most carriers encourage clients to use cargo insurance. This is partly because liability in cases of carriers can be so hazy. In claims made under cargo insurance legislature, nobody needs to prove negligence, acts of God, or other interventions. An accident happened, recompense is owed, and payment is made. Such events are rare, so premiums are affordable. Furthermore, the more reputable and locally-informed the company, the more wallet-friendly the deal is likely to be.
It is also because cargo insurance is part of making the process cost-effective and effortless for everyone involved. It increases profit, whilst ensuring peace of mind.
In cargo insurance, the client does not have to prove liability. This means that claims are very swift. Most are paid within 30 days, and require little more than basic paperwork.
The insurer that is chosen does need to be a reputable one. At NTEX, we advise using different insurers depending upon the destination. The risks are different in different countries. We use our local agent knowledge to keep abreast of developments, and negotiate with insurers accordingly.
What Does This Mean For Me?
In a case where you are deciding between carrier liability and cargo insurance, the value of the product is the most important variable. At NTEX, we take both very seriously. However, experience has taught us that cargo insurance is very important for valuable loads, or loads where the value is not linked to weight. Many of our clients use us to ship unique products, and a combination of insurance options are often necessary.
For straightforward transfers, we can offer hassle-free, tried and tested solutions. If you are transporting something a little bit different, please get in touch.