What’s in this Freight Paper?
- Difference between LTL and Truckload Coverages
- Definition of Third Party Insurance
- Tips for Getting Insurance and Avoiding Damage
Damaged freight is a frustrating but unavoidable aspect of both LTL and Truckload shipping. If you ship long enough, you’ll have to deal with damage. Finding the right broker and carrier can help avoid it. It’s also smart to package your freight correctly. Additionally, our FreightPros have found that Freight Insurance plays a large role in both LTL and Truckload shipping. In this definitive guide, we’ll supply all the information you’ll need to determine when you should look at getting insurance, the different types of insurance, and other helpful hints to keep you and your freight covered.
What is Freight Insurance?Freight Insurance is insurance that covers damage or loss in freight shipping. There are three types of insurance that we’ll discuss in this freight paper: LTL carrier insurance, Truckload insurance, and third party insurance. Though there are differences in coverage and deductibles, they all act like common insurance you might have for your health, or car.
LTL Carrier InsuranceAll LTL carriers have insurance coverage for every piece of freight they ship. These rates are included in the freight rate you’ll receive from your broker. Coverage and deductibles vary from carrier to carrier, and often depend on freight class, density, or value. Liability typically ranges from a few cents to a few dollars per pound. If you have high-value freight, chances are that LTL Carrier Insurance will not fully cover your product in the event of loss or damage.
Third Party InsuranceThird party insurance is offered for LTL shipments and truckload alike. It has an additional cost separate from the carrier’s freight quote. A $500 deductible typically applies. We strongly recommend using third party insurance if you’re shipping valuable or fragile material. Payouts are faster, easier, and- most importantly- larger with third party insurance than with carrier freight insurance.
Truckload InsuranceAt FreightPros, we only work with Truckload operators that offer a minimum of $100,000.00 in insurance coverage. This coverage is included in the freight rate. If you need additional coverage, third party insurance is also available. The coverage and rates for anything over $100K depend on the value and commodity, so check with your freight broker if you need supplemental insurance over $100K when shipping via our truckload team.
ConclusionWhen it comes to Freight Insurance, charges and use often vary from shipment to shipment, so you’ll need to ask your freight broker what kind of insurance works best for you and your freight. Regardless of your choice in insurance, it’s good to keep in mind these bullet points when considering your coverage.
- If you’re shipping expensive or fragile items via LTL shipping, invest in third party insurance.
- Truckload shipments will all be covered up to $100K. If you need additional insurance on top of that, reach out to your broker.
- LTL Carriers DO carry insurance, but don’t rely on it to pay out for damaged or loss shipments in full.
- Claims take time to investigate and complete. Download our How to File a Claim Freight Paper for more information.
- When dealing with damaged freight, ALWAYS note the damage on the Proof of Delivery. It’s very difficult to get paid on your insurance claim without evidence of damage at time of delivery. At times, it may be best to refuse the freight. Consult your broker for instructions for your damaged freight.