home
Institute of Logistical Management Tel: 315 W. Broad Street, Burlington NJ 08016 work: 1-888-ILM-4600 Fax: 609-747-1517 http://logisticseducation.edu http://logisticseducation.edu
Home

Freight Claims Management

Objectives:

  1. To explain Carrier liability for loss and/or damage via all modes of Transportation.
  2. To differentiate the legal requirements affecting each mode of Transportation, supported by pragmatic documentation, and legal statutes.
  3. To develop for the Student the historical and regulatory evolution of Cargo liability based on judicial decisions of worldwide precedence and recognition (Carmack Admendment).
  4. To explain what legal recourses are available to both Shippers and Consignees when loss and/or damage occurs in transit.
  5. To specify the rules and regulations for preparing and filing of claims against Carriers, with particular emphasis on Statute of Limitations and Documentation.
  6. To explain the very basic and pragmatic details that a claims professional must know in order to perform his/her job effectively.
  7. This course has been devised to allow professionals of both Shippers and Carriers to gain the most relevant knowledge on Freight Claims Management and be able to apply it immediately in a business environment. Students who successfully complete this Course will increase their professional competency in this specific area of Business Logistics.

Learning Outcome:

Upon successful completion of this course, the student will be able to understand the liability of domestic and international carriers; contracts of carriage; the liability terms contained in the bill of lading; tariff rules pertaining to liability; the process of preparing and filing claims; and the options available for recovering monetary damages.

Instruction:

Major topics covered in the course are the government regulations and statutes governing domestic transportation, (Carmack Amendment), contracts of carriage (truck, rail, air, ocean, and parcel express), rail and truck tariff rules, international treaties, claim preparation, filing, and recovery.

Topic Hours
1. Introduction to Claims Liability Carrier Liability Statutes 5*
2. Carmack Amendment 10*
3. Contracts of Carriage 10*
4. Bills of Lading 15*
5. Tariff Rules-Motor Carrier 15*
6. Tariff Rules-Rail/ International Treaties 15*
7. Bill of Lading Liability Exceptions Tariff Liability Limits 15*
8. Preparing and Filing Claims 10*
9. Options to Recover Full Amount 10*
10. Final Exam 5*
Total Hours 110*

*Estimated maximum hours (110 total hours) for assignments. Hours vary depending on experience and reading levels. The majority of students complete the assignments in less time than allocated.

Textbook:

Harvey, John T. Freight Claims-Filing and Recovery, Revised Edition, Huntington, NY: The Transportation Consumer Protection Council, Inc.

WHAT DOES FREIGHT LOSS OR DAMAGE REALLY COST?

All partners in transportation have a direct interest in loss and damage, cargo insurance and freight charges - and have exposure to liability whether using or providing common or contract carrier services. The "surprises" in transportation arrangements being introduced in a less-regulated environment can be costly to all parities!

Does your upper management realize that it takes $100,000 in sales to make enough net profit to offset a $1000 transit loss, if you are operating at a 1% ratio?

If your operating ratio is higher, apply this table to determine the true bottom-line cost of claims - whether you are a shipper, receiver, carrier, intermediary or insurer!

IF YOU OPERATE
AT NET PROFIT OF		 A CLAIM FOR
  $50 $100 $200 $300 $400 $500 $1,000
  EQUALS
SALES OF
2% $2,500 $5,000 $10,000 $15,000 $20,000 $25,000 $50,000
3% $1,667 $3,333 $6,667 $10,000 $13,333 $16,667 $33,383
4% $1,250 $2,500 $5,000 $7,500 $10,000 $12,500 $25,000
5% $1,000 $2,000 $4,000 $6,000 $8,000 $10,000 $20,000
6% $833 $1,667 $3,333 $5,000 $6,667 $8,333 $16,667

Direct claim amounts are only the beginning. For the total cost of claims, add to these losses the administrative cost of claims, the loss of interest and the loss of customer goodwill!

CCPAC Accreditation

Effective July 1, 2002 each Student who satisfactorily completes ILM's course in Freight Claims Management will receive a Certificate of Satisfactory Completion from ILM, along with 3 College Credits recommended by the American Council on Education equivalent to 55 CEU points towards the overall CCPAC accreditation.