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Cargo Archives

My Cargo is Damaged… Now What?

The volume of cargo transported all over the world, on a daily basis, to so many countries is really astounding. So many of the everyday items we use are supplied to us as a result of the trade agreements established between countries and via cargo ships or planes as the medium of transport.  Most of these products also arrive at their intended destination in good condition. However, on occasion, cargo does get damaged on its way to the consignee. So, what should you do if this happens to you?

What Happens Next…

Cargo can arrive at the consignee’s home or facility in a package, a container, or as part of an LCL shipment. When it is delivered, the carrier or an agent of the carrier, normally asks the consignee to sign a delivery document to record the delivery of the shipment. Before doing so, keep in mind that this is an ideal time to conduct a visual examination of the cargo.

• For non-containerized shipments, does the packaging appear intact?
• Are there any tears, rips, crushing or any other signs of damage to the external wrapping of the cargo?
• For a containerized shipment, does the container appear to be in good condition, without any obvious signs of damage or holes?
• Is the container seal in place and opened in the presence of the consignee?

If the package or the container appears to be damaged, it is important to notate as such in the delivery document (Proof of Delivery) provided by the carrier. This essentially allows the consignee to dispute the condition of the delivery and serves as a basis for a claim with the insurance company or carrier. A brief description of the extent of damage should be noted on the Proof of Delivery (POD) document, along with a notation that the cargo was received in damaged condition. Be as specific as possible.

In this instance, the consignee can ask to open the container to assess the cargo within in the presence of the carrier’s representative. If permitted, the container and shipment can be assessed for obvious leaks, holes, and shifting. This, too, should be notated in the Proof of Delivery document. The same is applicable to any non-containerized shipment as well. If the consignee is permitted to open them, they can document any damage to the shipment.

Don’t forget to take photographs or videos documenting any damage to the cargo, and the packaging in which it was shipped. This is especially true, if the damage is only evident after opening, and the consignee was not permitted to open the container or package in the presence of the carrier.

Note the condition of the packaging. Does it seem adequate, or, is it sparse / missing in areas? Save all packaging, and be sure to take pictures.

All delivery documents should be signed by both the carrier and the consignee, and the consignee should be provided with a copy for their own records.

You will also need to determine whether the cargo can be repaired, or sold at a discounted price, or whether the entire shipment is a total loss.

When making a freight claim, you will be asked:

• The nature and circumstances of the claim
• Contact information for everyone involved
• Estimated cost of damage incurred
• Whether the cargo is salvageable

Important documents needed for your claim:

• Bill of Lading
• Proof of Delivery
• Packing List
• Documents such as temp-tale charts
• Commercial invoice

Filing a loss or damaged claim with an insurance company or carrier is a lengthy process. After the initial filing, be prepared to wait for several weeks for them to collect and assess the documents. Follow up regularly to check on the progress of your case file.

The insurance company or carrier will send an independent 3rd party surveying company / damage claim specialist to visually assess the nature of your claim. Their report and findings serve as a basis for allowing or denying the claim.  On site, they will conduct a thorough visual examination of the cargo, and then proceed to test their functionality. They will test the electrical or mechanical functioning of the unit as well. A detailed report will be issued based on their findings.

In Conclusion…

Filing a freight claim is a lengthy process, requiring your patience and understanding. Before filing a claim:

• Assess damage to your cargo at the time of delivery
• Sign the POD, and notate any damages seen. Be specific
• Take pictures of the exterior packaging, and the cargo within (if you are permitted to open)
• Collect all necessary documents
• Assess whether the cargo is salvageable or is a total loss
• Check regularly with the carrier or insurance company for any status updates.
• Allow the 3rd party independent surveying company / damage claim specialists access to the cargo

Buyers and sellers have a lot to consider when shipping cargo, however, packaging material should also be given great consideration, in order to mitigate loss and damage. Product packaging serves an essential role in the supply chain, and is a key link for distribution, and damage and replacement costs.

What role does packaging play when shipping cargo?

• Optimal packaging can cushion cargo during handling

Cargo gets handled at so many points when transferred from the shipper to the consignee, that even if there is accidental rough handling at one-point, consequential impact to the cargo can be prevented. Impact resistant packaging is also especially crucial when handling delicate / fragile cargo.

Waterproof, polypropylene bags placed inside larger corrugated boxes, or bubble wrapped envelopes for smaller items can help preserve the integrity of the product.

How packaging affects your cargo

• Optimal packaging prevents the cargo from moving / shifting, and potentially impacting other cargo

 Cargo can often be individually wrapped and packed on pallets, thereby, any loss, is isolated and limited to a unit, as opposed to the entire cargo.

How packaging affects your cargo

Plastic wrapping atop individual cartons, secured by plastic ties, is often used. However, it is essential to ensure that the plastic wrap extends all the way to the bottom of the pallet. Often times, the cargo placed on the upper tiers remains intact, however, there can be damage to the bottom exposed corners of the cartons.

How packaging affects your cargo

• Proper packaging ensures that the cargo load gets evenly distributed on pallets

When loading cargo aboard a shipping container, handlers are mindful to load the heavier items at the bottom, and lighter items atop, so as to evenly distribute the freight load. The weight of the cargo must be evenly distributed, and air pockets minimized with cushioning. Optimal packaging weighs as a factor in cargo distribution by “holding up” when it is time to perform.  It allows for the ideal placement of cargo whether it be in a container, a shipping hold, flatbed truck, or a pallet.


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