Top 5 small business freight claims mistakes!

With Recoupex we create a possibility for all shippers globally to obtain compensation from the liable carriers when their cargo is damaged or lost in transit. On demand. One click solution so nobody gets left out.

Now, you might be wondering what are the top 5 mistakes importers and exporters globally make which cost them in lost claims and thousands USD unrecovered.

#1 Too late to pursue the claim. Time bar.

Most Bills of Ladings are subject to a one year time limitation after the day cargo war delivered. This means that if your claim has not been concluded within one year from date of delivery, the shipping line has a right to close the file and not compensate you for your lost or damaged cargo. In order to protect a time bar, court proceedings must have to be before the time bar date, or an extension of time be granted by the shipping line in writing following a written request from you.

#2 Lack of photographs of the damaged cargo and container

In the age where people go to bathroom with their smart phones, when it comes to cargo claims, so often cargo receivers do not take sufficient pictures to evidence cargo damage, container damage. It is extremely hard to win cargo claim if there are no photographic evidence proving the damage extent and cause of the damage.

#3 Lack of key document

Documents are a huge part of a claim. All carriers will require copies of the relevant claim documents, if you follow the list below, your documentation issues will be solved:

Documents required for ALL claims:

• Bill of lading
• Commercial invoice
• Packing list
• Letter of assignment / subrogation rights ( in case third party pursue claim on your behalf)
• Import/export documentation (shipping docs)
• Photographs evidencing extent of damage/loss of cargo
• Photographs of container evidencing cause of damage/loss of cargo
• Notification to shipping line ( email suffice )
• Claim value (breakdown of claim amount)
• Survey report ( third party or in house)
• Salvage invoice ( if cargo is salvageable)
• Destruction certificate (third party or in house)
• Fumigation certificate ( in case of contamination)
• Laboratory test results/report ( in case of contamination).

#4 Lack of proof of loss mitigation

By law, Claimant must do your utmost to mitigate cargo loss. Mitigation measures include, but are not limited to the following:

• Separating rotten/spoiled cargo from fresh cargo;
• Repairing damaged cargo;
• Curing damaged cargo;
• Re-bagging/repackaging damaged bags/packages, etc.;
• Selling products not fit for human consumption for animal feed ( when possible)
• If cargo cannot be resold at a lower value, a destruction certificate will be required to prove complete loss of cargo.

#5 The claim notification had NOT been sent to the carrier within 3 days of delivery or not sent at all

This is old legal requirement established in international convention (1924), which has nothing to do with the common sense in 2021. In essence it means if cargo receiver notifies shipping line within the 3 days after delivery, it is presumed that carrier is liable for the damage.

That’s why it is helpful to ensure you notify the shipping line within 3 days of delivery. Many shipping lines will NOT guide you as to what to do in order to ensure your claim has the best chances of a positive outcome. That’s why you need to be active in the claiming process.

The shipping line may also engage their own surveyor for joint inspection purposes. Your written notification should include the following details:

• Bill of Lading number;
• Container number;
• Cargo description;
• Nature or cause of loss or damage;
• Approximate value of loss of damage and the place and hour of destuffing. ( in case carrier wants to attend joint survey).

I’ve said it a thousand times and I’ll say it a thousand more success is one claim away. Now go and execute it!