Freight damage & shortage claims
Most shipments arrive complete and on time. When they don't, a quick inspection at delivery and a timely claim make all the difference. Here's how freight works, what to check, and how to file if something is damaged or missing.
How freight and F.O.B. terms work
The products Air Tech Sales supplies are shipped “F.O.B. Factory” and delivered to the customer (consignee) by a trucking or freight company (the carrier). In most cases the shipper (consignor) selects the carrier.
F.O.B. (free on board) determines the point at which legal ownership, or title, of the product changes from the shipper to the customer. “F.O.B. Factory” means title passes to the customer the moment the product is first loaded aboard the carrier's truck at the shipper's factory or warehouse. The F.O.B. point is set by the shipper, not by Air Tech Sales. The carriers our manufacturers use all carry insurance against loss or damage in transit, so under F.O.B. Factory, if there is freight damage or loss during transit, the customer is responsible for filing a freight claim with the carrier.
Luckily, most shipments are delivered complete, in good condition, and on time. The ones that cause the most grief arrive with freight damage or missing items (a shortage). The only way to know is to carefully inspect the shipment when it is delivered.
The shipping papers (the bill of lading) show how the product was originally handed to the carrier: whether it started on pallets or in cartons, the product type, quantities, weight, and pickup date. So if it shipped on pallets and arrives as loose boxes, something happened in transit and the shipment needs a careful inspection.
That brings us to the bigger problem of concealed damage, damage that isn't visible at delivery because it's inside a box or out of sight. It's very hard to prove after you've received and signed for a shipment without noting damage. To prevent a dispute with the carrier, inspect each shipment, each carton, and if necessary each item as you receive them. If a container shows any sign of tears, holes, unusual folds, dents, wrinkles, or sags, open it before signing. A few minutes of inspection can save your company a great deal. Once a shipment has sat in your possession for any length of time, it's difficult for a shipper to be sure damage came from transit rather than later handling.
We all dislike the inconvenience, but the customer must file the claim for your company to be reimbursed by the carrier. Claims filed promptly and completely tend to be resolved promptly. If you'd like, Air Tech Sales will help your firm complete the claim form.
Whether you file a claim is the customer's decision. Either way, you must still pay Air Tech Sales for the materials, even if damaged, destroyed, or lost. If you do file, the carrier will reimburse your company for damaged or lost products, replacements, and in some cases your time to repair the damage. Contact the carrier's claims department before starting any repair work, and save all damaged material and packaging until the carrier's claims department has inspected it. If a product is damaged beyond repair or lost and you reorder, that reorder will be billed by Air Tech Sales; you are expected to pay for the original order and any reorders.
Before you refuse a shipment, read this
You may refuse a shipment, but think through these eight points first:
- The material shipped to you is owned by you.
- The freight company will store it and use reasonable efforts to protect your property.
- As a rule, carriers will not pay freight claims while your freight is in their possession.
- The carrier will notify the shipper that the goods are on hand. The shipper usually will not take the shipment back, because it is owned by the customer.
- If freight is not claimed by the shipper or customer, it becomes the carrier's possession.
- The carrier has a lien for its freight charges and storage fees and can sell your goods to satisfy that lien.
- You will still have to pay Air Tech Sales for the shipment.
- It is usually best for all concerned to receive a damaged shipment and file a freight damage claim.
Filing a freight damage claim
Sign the delivery receipt as damaged
If you don't note the damage on the delivery receipt when it arrives, your claim will probably be denied. When signing for damage:
- Note all damage on the delivery slip.
- Make a copy or photo of the delivery slip with your notations.
- Take photos of the damage and the packaging.
- Save copies of all paperwork and photos related to the shipment and damaged materials.
- Ask the driver for the claims department phone number.
- If the driver refuses to let you sign or inspect, do not sign; refuse the shipment and contact the carrier or Air Tech Sales at 916-969-6730.
Notify the carrier immediately
Contact the carrier right away, request a freight damage claim form, and ask that an adjuster inspect the damage. Do not begin repairs without the carrier's written authorization, and do not destroy the freight or packaging until the claim is resolved.
Save the damaged freight and packaging
The freight must be available to the carrier for inspection or salvage pickup, so keep it stored until the claim is resolved.
File the claim
You must file the claim; Air Tech Sales cannot file it for you, but we'll help with any questions. Include:
- Completed freight claim form
- Product invoice from Air Tech Sales
- Original bill of lading
- Repair cost invoice (if applicable)
- Photos of the damage and packaging
- Claims adjuster's inspection report
- Description of the damage
Filing a concealed damage claim
Notify the carrier immediately
Contact the carrier right away, request a freight damage claim form, and ask that an adjuster inspect the damage. Do not begin repairs without the carrier's written authorization, and do not destroy the freight or packaging until the claim is resolved.
Save the damaged freight and packaging
Keep the freight stored and available to the carrier for inspection or salvage pickup until the claim is resolved.
File the claim
You must file the claim; Air Tech Sales will assist with questions. Include:
- Completed freight claim form
- Product invoice from Air Tech Sales
- Original bill of lading
- Repair cost invoice (if applicable)
- Photos of the damage and packaging
- Carrier inspection report
- Description of the damage
Filing a freight shortage claim
Sign the delivery receipt as short
If you don't note the shortage on the delivery receipt, your claim will probably be denied. When signing for a shortage:
- Note what is missing on the delivery slip.
- Make a copy or photo of the delivery slip with your notations.
- Save copies of all paperwork and photos related to the shipment.
- Ask the driver for the claims department phone number.
- If the driver refuses to let you sign or inspect, do not sign; refuse the shipment and contact the carrier or Air Tech Sales at 916-969-6730.
Notify the carrier immediately
Contact the carrier right away and request a freight claim form.
File the claim
You must file the claim; Air Tech Sales will assist with questions. Include:
- Completed freight claim form
- Product invoice from Air Tech Sales
- Original bill of lading
- Description of the shortage
Printable freight claim form
Prefer to work from a printed copy? Download the freight claim document in either format.