Ocean carriers lose about 10,000 containers at sea each year. While that shouldn’t keep you up at night – 770 million shipping containers were moved globally in 2014 and statistics are still on your side, it can happen to anyone. Even the best carriers can lose or damage your goods, which means you’ll have to file a freight claim.
What is a freight claim?
A freight claim is a legal instrument for demanding compensation when a carrier breaks the terms of the contract. This is more likely to happen when a sea carrier damages goods, as it is far less common for shipments to get lost or damaged when shipped by air (which is just another reason why you’ll pay a premium for air shipments). That said, insurance here is critical. Many carriers will have stipulations in terms and conditions that will net you minimum compensation for your shipment (usually in the ballpark of a couple of dollars per shipment) but booking your shipment with insurance will help get your actual product’s worth.
It’s important to remember that there is a time limit for filing a freight claim. You can usually find the time limit on the bill of lading or air waybill, so make sure you read the fine print.
Four steps to filing a freight claim:
- Identifying the goods. Get the exact information about your specific goods that were damaged or lost. This should be supplied by the claimant, after which the goods are ID’d by the carrier. If you were careful while booking the shipment, you should have documentation, like your commercial invoice.
- Confirmation. The carrier or forwarder will assess the claim and verify that the goods were damaged or lost.
- Valuation. Working together with the shipper, the valuation and damages will determined.
- Request for payment is submitted to the carrier.
Who can make a freight claim?
To submit a freight claim, you have to either be the legal owner (with a title) of the damaged freight, an entity accepting risk of loss in transit, or a legal proxy. The claim has to be made to the carrier of origin or delivery. The claim should be sent to the claims manager at the carrier’s headquarters. For the most part, the forwarder should be able to support you with this.
A Useful Tip
It’s not a great idea to estimate the amount of your loss before reaching a final, verified calculation.
If you file a claim that estimating the loss at around $5,000, then some carriers will mail you a check for $5,000. Once cashed, the carrier isn’t liable for any additional losses. The best way to value your claim is to give the carrier a maximum potential loss, and then when the investigation concludes the claim can be amended.
Documents You May Need For Freight Claims
- Original travel document (bill of lading)
- Inspection reports
- Inspection requests
- Proof of value
- Temperature reports
- Impact report
- Lab analysis
- Packaging certifications
- Weight certificates
- Carrier manifest (loading tallies)
- Notification of loss
- Waiver for inspection (by carrier)
Of course, not all of these documents are applicable in every case. For example, if your container was lost at sea, temperature documentation may be unnecessary.