John Thomas on Freight Brokering

Can a Freight Broker Be Liable?

In my training, I always talk about freight broker liability and what sets freight brokers apart from others in the supply chain and logistics process. Normally, a freight broker is NOT liable for property or cargo damage, missing pieces, injury, death or other related forms of acts related to cargo in transit.

But stay tuned, you might be surprised how this can turn on you AND you can learn some simple steps to avoid all this.

I'll be making another post related to this.

Freight Broker Liability Insurance

I contacted a representative for this insurance company. I indicated that if a freight broker does their "due diligence" they can easily and quickly find out the status of a motor carrier's insurance standing. It only takes 10 minutes.

Yet, the insurance rep told me that many people do NOT do their "due diligence". It is hard for me to believe this but I am realizing more and more that there are all sorts of individuals getting into freight brokering and not knowing what the heck they are doing. I talk to a few of them from time to time.

They have NO idea about their requirements and what is expected of them and they have NO idea what to expect from others. To be blunt, these people will not be around very long. Freight brokering is difficult enough when you KNOW all the requirements and expectations.

But there are people out there "winging it". All I can say is, Good Luck!

Each motor carrier, in addition to cargo insurance, is required to carry Bodily Injury and Property Damage (BI/PD) insurance by filing either a BMC91 or BMC91X. The amount depends upon the gross truck weight and the type of cargo being hauled.

And, like I said, it takes only 10 minutes to check this out. In the meantime, these insurance guys are making big bucks off of those freight brokers who are so ill-informed that they think they need this insurance coverage.

It's sort of sad.