Truck Dispatcher TruckDisp Cargo Claims and Carrier Liability 4 — Questions and Answers
Question 1: Under FMCSA regulations, what minimum cargo insurance level must for-hire motor carriers maintain for general freight?
- $100,000
- $300,000
- $750,000 (Correct answer)
- $1,000,000
Correct answer: $750,000
For-hire motor carriers transporting general freight must maintain a minimum of $750,000 in cargo liability insurance per FMCSA requirements.
Question 2: A dispatcher is coordinating a load of hazardous materials that is damaged in transit. Who bears primary liability for the cleanup costs?
- The freight broker
- The shipper who packaged the goods
- The motor carrier transporting the goods (Correct answer)
- The receiving facility
Correct answer: The motor carrier transporting the goods
The motor carrier in physical possession of hazardous materials during an incident bears primary liability for spill cleanup and environmental remediation costs.
Question 3: What is a 'concealed shortage' and how does it differ from a concealed damage claim?
- Both terms describe the same type of claim
- A concealed shortage means fewer items than invoiced; concealed damage means hidden physical damage (Correct answer)
- A concealed shortage involves hazmat; concealed damage involves general freight
- Concealed shortage is filed with FMCSA; concealed damage is filed with DOT
Correct answer: A concealed shortage means fewer items than invoiced; concealed damage means hidden physical damage
A concealed shortage refers to missing items discovered after delivery, while concealed damage refers to physical damage found after delivery without external signs.
Question 4: A carrier's tariff limits liability to $50 per shipment, but the shipper claims the goods were worth $5,000. What determines the applicable limit?
- Always the tariff limit
- Always the full value of goods
- The shipper's declared value or the tariff limit, whichever is higher
- The terms agreed upon in the bill of lading and any declared value endorsement (Correct answer)
Correct answer: The terms agreed upon in the bill of lading and any declared value endorsement
The applicable liability limit is governed by the bill of lading terms, carrier tariff, and any declared value the shipper paid additional charges to obtain.
Question 5: Which of the following scenarios would result in a carrier being fully liable for cargo damage?
- Cargo damage caused by an earthquake
- Cargo damage caused by the shipper's failure to disclose fragile contents
- Cargo damage caused by the driver's negligent loading (Correct answer)
- Cargo damage caused by a government-ordered quarantine
Correct answer: Cargo damage caused by the driver's negligent loading
Carriers are fully liable when damage results from their own negligence, such as a driver improperly securing or loading cargo.
Question 6: What is the purpose of a 'letter of protest' in cargo claims?
- To formally protest a freight rate increase
- To preserve a shipper's right to file a claim when damage is discovered after signing a clean delivery receipt (Correct answer)
- To dispute a carrier's insurance coverage
- To report a carrier to the FMCSA for unsafe practices
Correct answer: To preserve a shipper's right to file a claim when damage is discovered after signing a clean delivery receipt
A letter of protest is sent promptly to the carrier to notify them of discovered damage when a clean delivery receipt was signed, preserving the shipper's claim rights.
Question 7: When a broker arranges a shipment and cargo is lost, what is the broker's typical liability?
- Brokers are jointly liable with the carrier for all cargo loss
- Brokers generally have no direct cargo liability unless they acted as the carrier (Correct answer)
- Brokers are always liable for 50% of the cargo value
- Brokers are liable only if they provided cargo insurance
Correct answer: Brokers generally have no direct cargo liability unless they acted as the carrier
Licensed freight brokers typically are not liable for cargo loss unless they held themselves out as the carrier or took physical custody of the goods.
Truck Dispatcher TruckDisp Cargo Claims and Carrier Liability 4
Under FMCSA regulations, what minimum cargo insurance level must for-hire motor carriers maintain for general freight?