Load Booking Details

The BOL is only indicating pallet count, weight, shipper , consignee etc...no value on the actual BOL. There is a value on the customs documents. This is what I received from our insurance broker about this:

We can request and increase in our Motor Truck Cargo limit, however the average Cargo limits we see in the marketplace are $250k-$500k. In certain cases we have increased limits based on "one off" shipments, however if the exposure is consistent, an overall increase in your limits would be required.

The basis of settlement in the case of a Cargo Loss is adjusted either one of two ways. If the Cargo is shipped on a Declared Amount, the insurer would be responsible for paying the maximum damage, subject to the Motor Truck Cargo limit. In the absence of a declared amount, the adjustment is based on $2 per pound according to the Highway Traffic Act...it is therefore extremely important to have either a declared amount or existing contract with your customer(s) in place in order to protect all parties involved in the case of a Cargo Loss.

Depending on the exposure there could be a significant increase in your overall Motor Truck Cargo premium if we were to increase the limit to $1 million - $1.5 million.
 
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The big mistake everyone makes is the $2 a lb rule is only good in Canada, as soon as the load crosses the border your insurance company is on the hook for full value no matter what.
 
Another thing to think about in the case of loss, is the insurer will look at both the declared value on the Bill of Lading and the declared value for customs. They will then pay the lower of the two amounts.
 
Declared Value

I would like to see the jurisprudence on this matter.

We all know of the declared value on the B/L and the limits @ $2.00/lb.

I have been told by our insurance broker that We are insured for the full amount of the freight up until we reach our limit of $500,000.00 where our policy presently stands.

Since we do LTL we are generally covered, If our trailer contains $300,000.00 worth of cargo in two shipments and one weighs 40,000lbs and the other weighs 2000lbs , we are covered for all of the claim.

What worries me is that we have also been told that even if there is no declared value on the B/L and you are aware of the value of the freight and it exceeds $2.00/lb , you are held accountable.
This of course in any instance when you have access to the customs documents. Such as was our case!!

I do know of one case that was similar where Thorco transport moved a piece of machinery that was damaged in transit and they were sued in Excess of $2,000,000.00.
I believe the case was handled by the insurance in the end , but it took close to 10 years to resolve. In the interim it cost lots of monies to protect the corporate assets even to the point of setting up another company to operate under.
 
We had a case where there was a total loss of the shipment due to a truck fire. The shipper declared a value on the Bill of Lading of $200K but on the customs invoice the value was considerably less. When the insurance company discovered that, they paid out based on the value declared for customs, not the value on the B/L.
 
Dave in London said:
How'd you get that? My broker says AXXA will not insure cargo over 750,000?
Click to expand...

I am insured thru AXA which is now INTACT for 6 yrs. and i have $1,000,000.00 cargo and a rider that i can bump it up to $3,250,000.00 without even calling them. If i use the rider i have to fill out a quarterly report and submit it and they send me the bill for the excess.
 
Thanks T800. I'm going to have to talk to my broker. I had a 900,000 and we had some dancing to do.
Of course you never seem to find out the true value til its on the trailer. Good thing the shipper held contingent. 7 calls, 1 limit of liability fax and we were good to go.
 
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