Freight claims are like the income taxes of shipping. Nobody likes dealing with them, but you know you will have to manage freight claims at some point. The best way to approach them is to be well-prepared and well-informed. Understanding the claims resolution process can help make the freight claims process as painless as possible for shippers. This blog covers what to look for in the different types of freight claims and what procedures shippers can use to ensure fluid pickup procedures. It also explains why freight claims software facilitates a successful claim.
What to Look For: The Different Types of Freight Claims
There’s more to the freight claims process than meets the eye, sometimes literally. There can be visible damage, but it takes more than a cursory look; knowing what to look at is essential. Here are the four types of freight claims:
- Loss: This claim might seem the most obvious because the product was loaded at the point of origin but has yet to arrive at the destination. This claim is straightforward as long as records and other documentation are accurate.
- Shortage: The shortage claim occurs when the full amount of ordered goods does not reach the final destination and is a growing concern due to labor shortages. With fewer workers, there is an increased risk of human error as employees move quickly to keep up with the work.
- Damage: This is when a shipment arrives at its destination with visible damage that was not evident at the point of origin. This frequent claim often results from improper packaging or mishandling.
- Concealed damage or shortage: Some damage or shortage is not immediately apparent. It can be hidden by part of the packaging and not noticeable at first glance—sometimes, it can take days to notice. With a concealed shortage, diligence in checking to make sure the shipment and paperwork numbers are identical is essential.
Pickup Procedures to Ensure Smooth Resolution
Minimizing the risk of freight claims starts with proper shipping and pickup procedures. Shippers are responsible for preparing freight and ensuring shipment accuracy and should practice a high level of care to avoid potential damage and shortage claims. The pickup procedure tips below can help shippers reduce the likelihood of damaged freight and protect themselves from avoidable claims.
Proper Packing Procedures Minimize Damage Risk
Damage can come in different forms. There could be water damage, a load could shift or fall, or faulty containers could cause product contamination. In a high-stakes, understaffed transportation environment, it’s more vital than ever for shippers to have correct procedures in place. Let’s go over a step-by-step checklist for each shipment:
- Find the Right Packaging — Although the costs associated with packaging might pale compared to other supply chain expenses, investing in quality packaging and processes can limit expenses associated with damage in transit. Ensure that packaging is free of water damage, holes, tears, or dents and never exceeds the maximum weight the packaging manufacturer provides.
- Consider Crating — For fragile or easily damaged items, crating provides a flexible means of improving security in transit. To prevent damage, carefully wrap fragile items before crating, and pack crates as full as possible to avoid shaking and movement in transit.
- Stack with Caution — While stacking pallets effectively utilize space, not all freight is meant to be stacked. Shippers should keep in mind the weights and dimensions of pallets when stacking to avoid crushed cartons and damage claims
- Freight Security is Key — When shipping via truckload, the shipper must ensure freight is correctly loaded and secured. If special considerations like straps and load bars are required, communicate that to the carrier so they have the proper equipment at pickup. Furthermore, using shrinkwrap to secure loads, ensuring that each layer of wrapping overlaps by 50%, provides an additional layer of security.
Even with the best packing procedures, damage, and loss are sometimes unavoidable. Shippers need to know what to look for when receiving a shipment to ensure prompt, effective damage and loss claims resolution.
Piece Counts and BOL Accuracy Protect Against Shortage Claims
The bill of lading (BOL) should always accompany the shipment and include the shipper’s and consignee’s information, piece and pallet counts, and the shipment weight. It constitutes the contract of carriage; its terms and conditions are binding, and help determine liability in the event of a claim. Let’s take a closer look at why bills of lading and piece counts matter:
- The shipment details should include the number of pieces on each pallet. For example, it might say, “25 boxes on one pallet.” Shippers are responsible for verifying these counts while packing and loading.
- Most carriers do not verify the piece count or number of individual units in a shipment, but only the number of pallets or “handling units.” This is often accompanied by a said-to-contain (STC) or shipper loaded and counted (SLC) designation, which removes carrier liability for piece shortages.
- Failing to include individual piece counts on a bill of lading leaves shippers more vulnerable to shortage claims, so it is essential to remain diligent in counting and documentation practices.
Claims Happen – But Claims Management Software Can Help
Despite the best intentions and preparations in shipping, freight claims are sometimes inevitable. Managing these claims is notoriously time-consuming, but cloud-based freight claims management software can streamline and simplify the process. Here are several claims management software features that take the pain out of claims.
Deadline Tracking and Document Storage
A crucial part of the freight claims process is ensuring all of your documentation is in one place and ready to be shared when needed. Of equal importance is that you turn those documents in before the claim deadline. Freight claims management software offers integrated deadline management that can alert you and turn those missed deadlines into successful submissions. It can also store all the necessary documentation in one platform that can be quickly shared with other parties.
Integrated Communications
Often overlooked is the connectivity you need when making a freight claim. After all, multiple parties need to be involved, and communicating or connecting with them is essential to the process. The latest freight claims management software offers data that can be easily integrated to allow for real-time, two-way connectivity and communication. With it, correspondence among all parties can be more quickly and efficiently shared. There is now the ability to have a single source platform that keeps everyone in the loop using the same data.
Analytics
In addition to streamlining your freight claims process, the software performs analytics that can help you find ways to reduce the chances of freight claims before they happen. With the help of a cloud-based platform that can include easy-to-understand dashboards, you can see patterns, like which carrier is more prone to having damages occur or that a particular route tends to incur freight claims more than others.
Optimize Your Freight Claims Process with FreightClaims.com
Successful freight claims management involves a lot of parts and parties working together. It’s important to be well-versed in freight claims and well-prepared to ensure smooth pickup procedures. With the help of freight claims management software, you can combine all documentation onto a single cloud-based platform and streamline the freight claims process, providing insight with its analytics and making communication more fluid. FreightClaims.com’s software helps you manage freight claims from when you enter the details of your initial claim through each stage until settlement, turning what often becomes a marathon process into more of a streamlined sprint. One user-friendly platform enables you to organize pictures, documents, and communications while ensuring you meet deadlines. To learn more, visit our website today and request a demo.
