Cargo Risk Transfer Strategies for Freight Brokers in Trucking
posted by TrueNorth Transportation on Thursday, June 15, 2023
As freight brokers in the trucking industry, it's crucial to mitigate risks associated with cargo transportation. In this second installation of our Freight Brokerage Series, we explore strategies and options to help freight brokers safeguard their business and manage liabilities. Don't forget to read our first installment, too, Freight Broker Insurance 101: What Motor Carriers Need to Know to Protect their Freight Brokerage.
Understanding Liability
Under the Carmack Amendment, freight brokers are not legally liable for goods damaged during transit, since they do not physically possess the freight. However, customer contracts and service expectations are evolving, with some customers requiring brokers to assume direct liability for cargo losses. This trend poses financial risks to brokers and necessitates risk mitigation measures.
To protect your brokerage from potential financial risk, consider the following strategies based on your risk tolerance and financial position.
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