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They want to 'work with us' on this one. Maybe I will suggest it and see what happens ... (if I can keep from chuckling)
FLS - Revised Carrier Contract
- Thread starter AccountsReceivable@DRC
- Start date
30
Named certificate as per my post. That is the "no biggie". But since you mentioned it Michael Ludwig - slipping on the ice is very serious business.
And yes....I would sue the universe for it. Named...unnamed....the sidewalk itself and mother nature for making ice in the first place....
And yes....I would sue the universe for it. Named...unnamed....the sidewalk itself and mother nature for making ice in the first place....
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I am intrigued by this latest discussion. We all add certain companies as certificate holders. But how would it be legal to add a third party as an "additional insured" without first seeking that third party's permission? I just don't understand that. For example, we could all just haphazardly add FLS as an additional insured, but we are not in a legal position to do so. That would be sort of like me saying to FLS, I'll move this load for you, but if any claims arise, you could also sue company XYZ for damages. If company XYZ has not explicitly agreed to that, there is no way it would fly. Can anybody explain this to me?
30
Chica, you wouldn't add a third party without them first requesting to be added. There is still quite a bit of confusion here in Canada and in the US over the "additional insured and additional named insured" endorsement. Without getting into a complicated discussion about the nuances of each term, what a broker or a shipper should be asking for is:
1) notice of cancellation or substantial change to a carrier s policy
2) evidence that the carrier's insurance will extend the provisions of their policy to you in the event you are sued as a result of the carrier's negligence. In other words provide indemnification.
Large shippers and 3pl's have perhaps taken this approach a bit too far by requesting complete and unequivocal indemnity clauses in their transportation contracts. In simple terms, all a broker or shipper should be asking for is an assurance from the carriers insurer that if the carrier steps in the crapper for whatever reason, the insurer will defend the shipper/broker on their dime. That being said, a competent broker will still maintain his own CGL policy and a contingent cargo policy.
1) notice of cancellation or substantial change to a carrier s policy
2) evidence that the carrier's insurance will extend the provisions of their policy to you in the event you are sued as a result of the carrier's negligence. In other words provide indemnification.
Large shippers and 3pl's have perhaps taken this approach a bit too far by requesting complete and unequivocal indemnity clauses in their transportation contracts. In simple terms, all a broker or shipper should be asking for is an assurance from the carriers insurer that if the carrier steps in the crapper for whatever reason, the insurer will defend the shipper/broker on their dime. That being said, a competent broker will still maintain his own CGL policy and a contingent cargo policy.
20
You can add FLS as an additional insured to your policy, presuming your management team allows you that authority, without FLS' permission, as you are the one paying for the policy. What cannot happen is FLS adding themselves as additional insured to your policy without your approval.
The key to the whole discussion is the phrase "Named Additional Insured". That phrase by itself, and without any other parameters limiting its use, conjures up all sorts of potential problems.
Here's one of ours;
- XXXXXXXX., is added as Additional Insured but only with respect to liability arising out of the operations of the Named Insured.
Additional Insured, or Additional Insured & Loss Payee, are quite common and are meant to cover both parties to the transaction at hand. In this case, I am covering X's liability, but only as it relates to my operations. The "& Loss Payee" part is used by finance companies like GE Cap, CIT, and the like. Never add a customer to the "& Loss Payee" part. Should you write of a truck, trailer, and cargo, you would need the customers authorization to cash the cheque for your truck and trailer. "Named Insured" in this case refers to me, the policy holder.
Named Additional Insured, without the "but ...", would mean I am insuring X for everything they do, whether it pertains to my operations or not.
Example ... a few years ago I was hired to make an oversize move within Norfolk County. Because I had to get a county permit, the county required an insurance certificate that included them as a Named Additional Insured. In effect I had to add Norfolk County to my policy which meant I covered all of their liabilities and potential liabilities for the effective time span of the certificate. So if on the other side of the county, a county truck caused an accident, my insurance would have to pay. It is immaterial that I had nothing to do with the county on that day.
Should such an event occur, the county's insurance would look at all the Named Additional Insured certificates that they had on hand and throw them before the court should a lawsuit occur. Our insurance would have no choice but to pay, and the county's own insurance would come last on the list of payees.
Needless to say, I informed the county that they could take a flying leap at a rolling doughnut, and didn't do the oversize move. My insurance company would not have endorsed it anyways.
Insurance is a very, very, very tricky business these days. Years ago you could count on your insurance policy to cover you for all perils. What you get now is an all perils policy with a list of exclusions a mile long. When you go over your policy with your broker, it should take 4 or 5 hours of reading and explaining to go through your policy. Your are being foolish, and not doing yourself any favours, if you are simply signing the policy as presented without knowing exactly what you are signing and paying for. If your broker has not set aside the whole day for you at policy renewal, find another broker.
The key to the whole discussion is the phrase "Named Additional Insured". That phrase by itself, and without any other parameters limiting its use, conjures up all sorts of potential problems.
Here's one of ours;
- XXXXXXXX., is added as Additional Insured but only with respect to liability arising out of the operations of the Named Insured.
Additional Insured, or Additional Insured & Loss Payee, are quite common and are meant to cover both parties to the transaction at hand. In this case, I am covering X's liability, but only as it relates to my operations. The "& Loss Payee" part is used by finance companies like GE Cap, CIT, and the like. Never add a customer to the "& Loss Payee" part. Should you write of a truck, trailer, and cargo, you would need the customers authorization to cash the cheque for your truck and trailer. "Named Insured" in this case refers to me, the policy holder.
Named Additional Insured, without the "but ...", would mean I am insuring X for everything they do, whether it pertains to my operations or not.
Example ... a few years ago I was hired to make an oversize move within Norfolk County. Because I had to get a county permit, the county required an insurance certificate that included them as a Named Additional Insured. In effect I had to add Norfolk County to my policy which meant I covered all of their liabilities and potential liabilities for the effective time span of the certificate. So if on the other side of the county, a county truck caused an accident, my insurance would have to pay. It is immaterial that I had nothing to do with the county on that day.
Should such an event occur, the county's insurance would look at all the Named Additional Insured certificates that they had on hand and throw them before the court should a lawsuit occur. Our insurance would have no choice but to pay, and the county's own insurance would come last on the list of payees.
Needless to say, I informed the county that they could take a flying leap at a rolling doughnut, and didn't do the oversize move. My insurance company would not have endorsed it anyways.
Insurance is a very, very, very tricky business these days. Years ago you could count on your insurance policy to cover you for all perils. What you get now is an all perils policy with a list of exclusions a mile long. When you go over your policy with your broker, it should take 4 or 5 hours of reading and explaining to go through your policy. Your are being foolish, and not doing yourself any favours, if you are simply signing the policy as presented without knowing exactly what you are signing and paying for. If your broker has not set aside the whole day for you at policy renewal, find another broker.
20
We just tried again to get our amended contract approved. Apparently, most amendments will be considered but section 38.1 MUST stay as is:
"38.1 The terms and conditions of this Contract shall govern and supersede any contract terms and conditions that may be prescribed by Canadian and provincial laws or regulaltions, as well as any bills of lading, delivery receipts, carrier confirmation forms or other shipping documents."
It's like going skydiving and agreeing that no parachute is needed! Ridiculous......
"38.1 The terms and conditions of this Contract shall govern and supersede any contract terms and conditions that may be prescribed by Canadian and provincial laws or regulaltions, as well as any bills of lading, delivery receipts, carrier confirmation forms or other shipping documents."
It's like going skydiving and agreeing that no parachute is needed! Ridiculous......
20
Well you don't need a parachute to go skydiving ... you only need a parachute to go skydiving twice.
20
^^^^ I just had to get that one in there before anyone else did ... LOL
I just went through a different load broker's contract today that said exactly the same thing. Funny though, they're from Quebec too. That was one particular revision I amended on the contract, along with about 12 or 13 others. It's pretty big brokerage house too. We'll see if they agree. If they don't, then I guess we just can't do business with them. For this particular contract you would have to be completely stupid to sign it. The other thing I found in it was that everything that was questionable, was in there a second time somewhere. Took me two hours to go through the whole thing line by line and word by word.
Will let you all know how it goes after the load broker's "legal advisors" make their decision.
I just went through a different load broker's contract today that said exactly the same thing. Funny though, they're from Quebec too. That was one particular revision I amended on the contract, along with about 12 or 13 others. It's pretty big brokerage house too. We'll see if they agree. If they don't, then I guess we just can't do business with them. For this particular contract you would have to be completely stupid to sign it. The other thing I found in it was that everything that was questionable, was in there a second time somewhere. Took me two hours to go through the whole thing line by line and word by word.
Will let you all know how it goes after the load broker's "legal advisors" make their decision.
Why is it that most of these "contracts" come from 3pl's? You rarely see something this detailed and demanding come from a direct shipper customer. 95% of all my customers have ever asked for anything other than rates. Only rarely do any of them even ask for proof of insurance. Am I just lucky?
20
No, that's pretty much the norm.
I find that broker contracts come as one of two types. They are either very fair and equitable, or they are very, very one-sided in favor of the broker. I find that the one-sided contracts tend to come from Canadian brokerages, and the fair ones come from the bigger, well established U.S. brokerages. Believe it or not even CHR's is reasonable.
I find that broker contracts come as one of two types. They are either very fair and equitable, or they are very, very one-sided in favor of the broker. I find that the one-sided contracts tend to come from Canadian brokerages, and the fair ones come from the bigger, well established U.S. brokerages. Believe it or not even CHR's is reasonable.
Thanks Micheal for the concise understanding of the 'Named Additional Insured'. I went through this a few years ago when trying to renew a contract with XTRA Lease. They demanded they be added as 'Named Additional Insured' and my broker told me the same thing - that it opens up the opportunity to have your insurance policy be implicated with something completely unrelated to you as a carrier. The vendor will say that if something unrelated happens they will not implicate you but in Canadian law, your insurance company must represent itself if the vendor is additional insured for any lawsuit.
I think it stems from the fact that the wording in the US and Canadian insurance companies differ, albeit very slightly, from their perceived intentions.
Either way, having 'named additional insured' parties on your policy is dangerous. Everyone should review this with their insurance broker.
I think it stems from the fact that the wording in the US and Canadian insurance companies differ, albeit very slightly, from their perceived intentions.
Either way, having 'named additional insured' parties on your policy is dangerous. Everyone should review this with their insurance broker.