CTB Carrier Selection & Risk Management 2 — Questions and Answers
Question 1: A broker discovers that a carrier's operating authority was revoked two weeks ago but the carrier is still accepting loads. What is the broker's primary obligation?
- Notify FMCSA immediately and refuse to tender the load (Correct answer)
- Complete the current shipment and then stop using the carrier
- Allow the carrier to finish in-transit loads only
- Verify with the shipper before making any decisions
Correct answer: Notify FMCSA immediately and refuse to tender the load
Brokers must verify active operating authority before each load tender; using a carrier with revoked authority exposes the broker to liability and violates federal regulations.
Question 2: Which FMCSA safety rating indicates that a carrier has been found to have critical safety violations that could result in service suspension?
- Conditional
- Satisfactory
- Unsatisfactory (Correct answer)
- Unrated
Correct answer: Unsatisfactory
An 'Unsatisfactory' safety rating means the carrier has failed to comply with safety standards and may be ordered out of service by FMCSA.
Question 3: A carrier has a satisfactory FMCSA safety rating but a poor Carrier Safety Measurement System (SMS) score in the Hours of Service BASIC. How should a broker interpret this?
- SMS data can indicate emerging risk even when the formal rating is satisfactory (Correct answer)
- The satisfactory rating overrides any SMS concerns
- SMS scores are only relevant for hazmat carriers
- The broker should request a new FMCSA audit before using the carrier
Correct answer: SMS data can indicate emerging risk even when the formal rating is satisfactory
SMS BASIC scores provide real-time behavioral data and can reveal risk trends that lag behind the periodic formal safety rating reviews.
Question 4: What minimum cargo insurance limit do most shippers and brokers require carriers to carry per standard industry practice?
- $10,000
- $50,000
- $100,000 (Correct answer)
- $250,000
Correct answer: $100,000
The industry standard minimum for carrier cargo insurance is $100,000 per occurrence, though high-value or specialized freight often requires higher limits.
Question 5: A shipper insists on using a specific carrier that the broker knows has multiple at-fault accidents in the past 12 months. What is the best course of action?
- Document the shipper's request and the safety concerns in writing, then let the shipper decide (Correct answer)
- Comply with the shipper's request since liability shifts to the shipper
- Refuse outright and offer no alternatives
- Use the carrier without disclosing the safety record
Correct answer: Document the shipper's request and the safety concerns in writing, then let the shipper decide
Brokers should document safety concerns and communicate them to the shipper in writing to demonstrate due diligence, while the shipper retains the right to make the final selection.
Question 6: Which document must a motor carrier file with FMCSA to prove it meets minimum public liability insurance requirements?
- Form MCS-90 (Correct answer)
- Form BOC-3
- Form OP-1
- Form MCS-150
Correct answer: Form MCS-90
Form MCS-90 is the endorsement that motor carriers must file with FMCSA to certify compliance with minimum public liability insurance requirements.
Question 7: What does a broker contingent cargo liability policy cover?
- Cargo losses when the carrier's own cargo policy fails to pay (Correct answer)
- The broker's own equipment damage
- Shipper's inventory losses before the freight is tendered
- Carrier liability for third-party bodily injury
Correct answer: Cargo losses when the carrier's own cargo policy fails to pay
Contingent cargo coverage protects the broker when the primary carrier's cargo insurance is exhausted, denied, or the carrier is insolvent.
CTB Carrier Selection & Risk Management 2
A broker discovers that a carrier's operating authority was revoked two weeks ago but the carrier is still accepting loads.
What is the broker's primary obligation?