Cargo Claims Guide: How to Prevent, Handle and Settle Them

A cargo claim is a demand for payment when freight is damaged, short, lost or delayed while in a carrier's care. One claim can wipe out a month of profit or put your insurance at risk, so the best strategy is preventing claims and documenting every load so you can defend the ones that happen.

How cargo liability works, in plain terms

For most interstate truckload freight, carrier liability falls under a federal law known as the Carmack Amendment. In simple terms, a motor carrier is generally responsible for actual loss or damage to the goods it hauls, with limited exceptions such as acts of God, acts of the shipper or the inherent nature of the goods. Liability can be limited by agreement in some cases.

Brokers usually require you to carry cargo insurance, often with a specific minimum limit, and their contracts may add their own claim terms. Federal cargo insurance requirements apply to some carrier types, such as household goods movers, but not to most general freight carriers. Confirm the current rules with FMCSA and talk to your insurance agent about the right coverage for what you haul. Our guide to trucking insurance explains the main policy types.

This is a summary, not legal advice. For a specific claim, talk to your insurance agent or a transportation attorney.

Prevention starts at pickup

Most claims are won or lost before the truck leaves the shipper.

Pickup checklist

• Verify piece count, pallet count and condition against the BOL
• Watch loading when the shipper allows it
• Photograph the freight, the load pattern and any visible damage before the doors close
• Note exceptions on the BOL, such as "2 pallets shrink-wrap torn" or "crushed corner on 1 carton"
• If you could not count or watch loading, request "shipper load and count" (SLC) on the BOL
• Record the seal number on the BOL and photograph the seal
• For reefer: confirm the setpoint on the rate con and BOL, pre-cool the trailer, record product temperature if allowed, and keep the unit download
• For flatbed: secure and tarp to the shipper's requirements and federal securement rules

Never sign a clean BOL for freight you know has a problem. Once you sign without exceptions, you have accepted it in good condition.

Protect the load in transit

• Drive for the freight: smooth braking and turns, especially with tall or top-heavy loads
• Check securement within the required early miles and at regular stops on open-deck loads; see flatbed cargo securement
• Monitor reefer temperature and respond to alarms immediately
• Park in well-lit, secure locations and avoid leaving loaded trailers unattended in high-theft areas
• Never break a seal unless instructed in writing by the broker or shipper, and document it if a scale or inspection officer opens it

At delivery: document everything

If something is wrong at the receiver:

1. Do not argue at the dock. Stay calm and focus on documentation.
2. Photograph the seal before it is cut, the trailer before unloading, and all damaged product.
3. Make sure exceptions are written on the delivery receipt. The receiver will note damage or shortage; make sure the notes are accurate and specific.
4. Call the broker immediately from the dock. Do not leave without instructions on refused or partially refused freight.
5. Get refused freight instructions in writing. If the receiver refuses product, the broker should tell you where to take it. Do not dump or salvage freight on your own.
6. Notify your insurance agent as soon as you know there may be a claim.

How the claim process usually works

1. Written claim filed. The shipper, consignee or broker files a written claim with supporting documents: invoice, BOL, delivery receipt with exceptions, photos.
2. Acknowledgment. Federal regulations for interstate carriers set time frames to acknowledge a claim and then pay, decline or make a firm offer. Confirm the current requirements with FMCSA or your attorney.
3. Investigation. You and your insurer review the documents, the seal records, temperature downloads and photos.
4. Resolution. The claim is paid, partly paid, declined with reasons, or negotiated.
5. Salvage. Damaged freight often has salvage value, which may reduce the claim amount.

Worked example

Hypothetical example: a claim comes in for $8,000 of damaged product. Your cargo policy has a $2,500 deductible. If the claim is covered and paid in full, your insurer pays $5,500 and you pay $2,500. If the damaged product is sold for salvage at $1,000 and the claim is reduced to $7,000, the insurer's share drops to $4,500 and your deductible stays the same. That is why salvage and accurate claim amounts matter. Ask your agent how your own policy handles deductibles and salvage.

Common claim types and your best evidence

Watch for claim terms in broker agreements

Before you sign a broker-carrier agreement, read the claims section. Watch for:

• Clauses letting the broker deduct claims from unrelated loads
• Holding payment on all loads while any claim is open
• Liability for "full invoice value" without limits on high-value freight
• Short deadlines for you to respond

You do not have to accept every term. Ask questions, and have an attorney review your standard agreements. Our guide on how to vet a freight broker covers other contract terms to check, and how to read a rate confirmation shows where commodity and value notes appear.

How Texas Solutions can help

Texas Solutions is a dispatch service, not a broker or motor carrier. Our dispatchers check commodity, value and special requirements before you accept a load, keep broker communication and paperwork organized 24/7, and you approve every load. See our dispatch services or talk to a dispatcher.

Frequently asked questions