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A Brief Overview of the Carmack Amendment
The Interstate Commerce Act was established in 1887 to deal with the rise of the railroads and the growth of cross country travel and freight delivery. The intent was to regulate interstate transportation.
In 1906, the Carmack Amendment was added to the Interstate Commerce Act which was enacted by Congress to establish uniform federal guidelines for shipping across state lines. These guidelines were designed to reduce confusion surrounding a carrier's liability when there was damage to a shipper's interstate shipment.
The Carmack Amendment establishes the limits of liability for the carriers. The liability imposed is for the “actual loss or injury to the property”. There are no caps on liability the carrier assumes through the Carmack Amendment. Therefor, when the carrier takes possesion of the cargo they become 100% liable for the load.
The carrier and the shipper sign a contract named a "bill of lading". The Carmack Amendment allows some carriers to limit their liability in this contract. The amount they assume for cargo damage can vary, but it's generally around $1 Per Lb.
The Carmack Amendment supersedes individual state laws and ensures that all parties are treated with one set of rules. This also means that any state law claims can be dismissed, as the Carmack Amendment takes precedence.
There is a protocol for filing claims under the Carmack Amendment. In order to bring a lawsuit, a written claim must be filed with the carrier within nine months of the date of the delivery of the property. If no delivery was made, then the claim needs to be filed within nine months after a reasonable time for delivery has passed.
Feel free to contact us with any questions or concerns you may have about the Carmack Amendment or other shipping related laws. It's our speciality and we're happy to help.
What you need to know about International Cargo Insurance
If your business conducts business with ocean freight, purchasing insurance could be a valuable asset to stablizing your bottom line. Maritime law dictates that if a cargo ship need to jettison any cargo to preserve the lives aboard and the ship itself, all owners of cargo share the cost of the lost goods. You could still receive your products but also still receive a bill to pay for the lost goods of another patron.
Cargo ships sink and are attacked on a frequent basis.
These kinds of events should be expected. This is why having ocean freight insurance can help save you money. It not only allocates funds for lost cargo, but it also relinquishes your financial liability to recooperate the losses of the other cargo owners.
It is important to know who needs to provide the insurance. Sometimes the shipper exporting the goods will insure them until they reach the buyer. Insuring through a company in the United States can provide you some added advantage if you need to file a claim.
As always, document carefully the value of each item. This gives you standing in which to enforce your claim.
Be sure to take care in reading what type of coverage you are receiving. Some insurers will offer an "all-risk" type of insurance so that any event will be covered for you & others offer specified perils only.
When needing goods shipped over seas, it is important to consider insurance for your shipment. If you don't, you could be financially responsible for the other customers' cargo too.
Do Freight Brokers Really Need Auto Insurance?
Freight Brokers wrestle with many questions when deciding cost management strategies. One of the biggest is whether or not they need Auto Insurance. The straight forward answer is absolutely. There are so many unpredictable, uncontrollable forces out there, (accidents, storms, hijackings, theft, vandalism) that it's impossible to avoid a lawsuit sooner or later, even if you have nothing to do with the incident. Just having your cargo there can put you at risk. If a truck gets into an accident, the first thing lawyers want to do is drag everybody they can into court. The average claim on an auto accident is about 2.6 million dollars. Without proper Auto Liability Insurance, such a claim can be devastating to a business. Liability costs for shipping skyrockets, severly impairing profitability.
There are many steps you can take to protect your assets and not face serious punitive damages as a result of death or injury from the movement of freight. One of the best steps is having someone with years of industry experience to review your current business model & current contracts in place. GSIS, Inc. is a leader in Risk Management education and Insurance Solutions. Our company is focused on educating our clients on risk management stratagies for the freight broker industry. We are always interested in spreading current news topics relating to the industry including major catastrophes and current laws that effect the Freight Broker/Transportation industry. Contact us at http://www.gsis.com
Here at Global Solutions Insurance Services Inc. we deal in the many forms of domestic and international trade insurance and our trained professionals help you choose a policy that fits your needs perfectly.
