6 Strategies to Side-Step Concealed Damage Claim Drama

07/27/2021 — Jen Deming

“Freight claim” is a bad word that no one wants to hear in shipping. Submitting a freight claim and hoping that a carrier will fairly reimburse you for replacements and repairs often feels like a shot in the dark. Concealed damage claims, specifically, can escalate pain points because they’re even more challenging to navigate. Concealed claims include damages not immediately noticeable at delivery, such as loss related to temperature changes in the van or shifting of product in the packaging. The good news is that concealed damage claims don’t have to be a death sentence for your freight. There are six ways that you can set yourself up for a win with your concealed freight claim.

Strategy 1 - Do not turn away the driver

Right out of the gate, if you notice that your shipment is damaged at arrival, it can be tempting to turn away the driver and refuse the load. Many shippers erroneously think that by accepting the freight, you are giving the carrier the “all clear” and therefore responsible for any damages. This is not true — the first step in getting compensation is accepting the load. If you refuse the load, the carrier will have to take the shipment back to a terminal for storage. This is especially important in the case of concealed damages, as it increases risk for even more handling issues that aren’t immediately obvious, as well as potentially racking up some extra fees for storage.

Also important to note, many insurance policies state that the freight must be accepted in order to start the claims process. Accepting the freight ensures you are in control of the situation and the next steps for the shipment, not the carrier. Once the load is accepted, you can start reviewing the shipment for concealed damages and start the claims process.

Strategy 2 - Take your time inspecting the delivery

Freight delivery drivers have many stops to make throughout the day and try their best to adhere to a pretty tight delivery deadline. It’s in their best interest to move along quickly by limiting time spent at each stop. So it’s pretty common to feel a driver may be rushing the delivery process in order to get back on the road.

Even though you may feel hurried by the driver, know that as a consignee, you have the right to take adequate time to properly inspect your shipment. Your first step should be a cursory review of outer packaging such as crates, boxes, and binding materials like shrink wrap and packing tape. Confirm you have the correct load by reviewing address labels. Directive stickers like those indicating fragile shipments or temperature-controlled items should be present to help indicate that it was packaged properly in the first place. 

With the driver present, open palletized boxes and crates, starting with those that have any visible damage. Make sure anyone accepting the delivery knows what to look for on an initial inspection. Afterwards, conduct a secondary, more detailed inspection of all freight in order to find less obvious, concealed damages.

Strategy 3 - Be thorough on the delivery receipt

Upon delivery, a piece of documentation called the delivery receipt will be presented to the consignee to essentially sign off on the shipment. This serves as legal proof that the load arrived “free and clear”, indicating no damages or loss while moving under the responsibility of the carrier. When marking the delivery receipt, it’s critical to note anything that may seem off or potentially damaged in your shipment. Simply adding that the shipment is “pending further review” on the receipt will not protect you, so it’s especially important to act quickly and thoroughly check for damages at the time of delivery. While reviewing alongside the driver, indicate anything like item counts, broken crates, torn packaging, holes, or stains that may indicate mishandling or tampering.

Oftentimes, these notations will result in an exception. Exceptions are notes on a delivery receipt that indicate anything out of the ordinary, but may not lead to a claim. If packaging is damaged but the product inside is intact, you can rest easy knowing that you have your findings on file. That way, if concealed damages are found on secondary review, you have evidence that something was amiss with the delivery from the start. Finally, be sure when signing the delivery receipt that you have the driver confirm and sign as well.

Strategy 4 - Take plenty of pictures 

The first rule of damage claims is especially important for concealed damages — the more evidence you submit, the more you protect yourself against a denied freight claim. To supplement any documentation you may submit for the claim, it is in your best interest to take pictures or video of different points in the load’s progress, starting with the shipper’s packing procedures. That way, you have the proof that the load was handed off in perfect condition when it was tendered to the carrier. 

Photograph the initial inspection and secondary review. Snap pictures throughout the delivery inspection from start to finish, including unopened boxes, visible damage, as well as photos of packed product once opened. If you find damages, make sure you take photos or video of the found damages from every angle, with and without flash or in different lighting scenarios. Backing up documentation with supplemental pictures of the paperwork noting damages is also helpful to have.

Strategy 5 - Act quickly when filing

A common misconception is that carriers automatically start the claims process when notified of any damages. This is a fatal mistake for your concealed damage claim. In general, concealed damage claims typically need to be filed with the carrier within five days. If filed in that time, you have to prove that it didn’t happen at the destination.  

Knowing you have a very strict timeline when filing your freight claim can make an already tense situation harder to handle. If you work with a 3PL broker, you get some extra help in meeting deadlines for filing and setting up a inspection appointment with the carrier. You’ll also get advice on what documentation you need to be set up for success, as well as advice on other strategies you can use to ensure a full payout.

Strategy 6 - Consider freight insurance options

One of the most important concealed damage claim tips you can follow is to seriously consider outside freight insurance options. Carrier liability is limited, and they will do everything within their power to pay the least amount possible for damaged shipments. Payouts are usually determined by product type and class number, which means even if you follow filing procedures to the letter, you may still receive reimbursement that is nowhere near the complete value of your freight.

By using third-party freight insurance, you are covered for the full value of your load, regardless of the commodity or class. You  may have more flexibility on filing times and do not have to prove that the damage was caused by the carrier. If your shipment experiences concealed damages, third-party insurance can help alleviate the escalated stress associated with filing for damages found after delivery.

You should remember...

Concealed damage claims are extra tricky, and most carriers count on you making mistakes during inspections and filing so they can avoid pricey payouts. But, you can win concealed damage claims if you follow some key steps that are extra important in the case of hidden damages. PartnerShip experts have had success winning concealed damage claim payouts, and can help guide your filing process from start-to-finish, better ensuring you are compensated for your damaged freight.