• 03-04-2022

How to handle damaged Cargo

Any discussion on supply chain risk management and applying managed transportation to help prevent risks from coming to fruition is incomplete without touching on the pandemic to overcome supply chain disruption.

Damaged cargo is a typical occurrence in all forms of transportation logistics. In this article, we share information about what to do when cargo damage happens. And is important for you to determine your loss of time and money and reduce the inherited frustration that comes along with dealing with the damage claims.

In easy terms, when cargo damage happens, the key undergoes the cargo damage claims is to register with the parties in the contract of carriage, file for a claim within the set time frame, to confirm all shipping, freight document, and proof of damages are indisputable, and lastly, to do your level best to mitigate the damage from exacerbating.

Let’s dive in further to know how to deal with damaged cargo

Since the majority of cargo transportation is by sea. In sea transportation, the common parties involved are:-

  • The Carrier
  • The Shipper
  • The Consignee
  • The Port Operator
  • The marine insurance provider
  • The truck drivers

This likelihood of a package incurring damage will grow for longer routes and for those shipments that demand more handling due to penalty issues, or that need to be delivered to underutilized lanes, which might include an item transfer to another truck, or multiple trucks, in order to reach its intended destination. Ideally, every package you send or receive would come clean, because we live in an imperfect world. If you receive a damaged item or freight that is clearly broken or marred, there is a right way to handle the situation. Steps to handle damaged cargo are listed below:

1: Do not ride the driver away!

Handling damaged cargo comes part and parcel with the business, and you will finally face a situation where you have to determine whether or not to sign for the damaged goods or to refuse them. When it comes to carriers and freight contracts, treat them seriously. Refusing to take the goods in this situation will likely only cost you even more money in the long run, since you could be on the line for further shipping costs. Do not turn the driver away, instead, as counter-intuitive as it might seem, accept the freight, damages, and all.

2: Accept the damaged goods

If you get the damages, thoroughly document the specifics, and then file a claim. Various factors can decide whether it was the fault of the original shipper, such as cases of insufficient or inadequate packaging, or if the harm happened during the carrier’s haul, they will be found at fault and will have insurance to cover such losses.

If you do not accept the damaged freight, the carrier will likely have to send it back to their warehouse and store it as the claim is processed.

3: Document everything

After accepting the damaged freight, you should instantly act and create a note of any shortages or damages on the Bill of Lading (BOL) or proof of delivery (POD) provided by the carrier. If there are any exceptions, those too should be noted. An exception does not need a claim; however, if there are no anomalies pointed out in the BOL or POD, your claim representative will face a difficult challenge in collecting on the claim.

4: Keep the freight (and Packaging)

The carrier has the right to review the damage in person and has the right to salvage the damaged freight. Disallowing them that chance could mean the claim is not fully paid or declined outright. However, in the cases of goods that do not keep or spoil such as food or dangerous materials, outside disposal laws may supersede a carrier’s salvage rights. That said, they do have to be notified first, so they have the opportunity to act.

5: Pay the charges

Just as there is a claim valuation timeline, there are also requirements that claims be filed along with a copy of the paid freight bill. If you do not pay the freight bill, regardless of who is at fault, that can hurt the resolution of your claim. By paying the freight bill immediately, you display good faith. It may be upsetting or seem unjust, but it is the wisest route and the one that is most likely to end with you getting every single cent back.

6: File the freight claim immediately

As with documentation, filing the freight claim should be done immediately. You have to acknowledge a claim within a month of the initial filing. After that, a final disposition has to be handed over in writing within a three-month period. Following that, the claimant will have two years to dispute the disposition. If you file a claim after the initial claim period, that claim will be automatically voided.

7: Do not forget to keep copies of everything!

Fill out this checklist, do you have:

  • . A copy of the Bill of Lading
  • A copy of the paid freight bill
  • A copy of the invoice that shows the price paid for the damaged goods
  • A copy of the packing slip
  • A standard claim form or a letter identifying the shipment and the claim amount.
  • Copies of photos of the damage