When Bad Weather Hits, Quality Carriers Shine

Sub-zero temperatures are not kind to diesel fuel; they push it toward an unstable gel, which impedes its flow. Not coincidentally, the freezing temperatures and the widespread nasty winter weather impacting most of the country can similarly impede the flow of cargo over the nation’s highways.

Generally speaking, loads are moving a little slower, and missed appointments may have become more frequent this winter.

These conditions can offer a glimpse into the quality of your carrier. When bad weather hits, delays are almost a certainty, but how they are dealt with separates high quality providers from the pack. The service aspect of the relationship becomes critical. Here’s what comes with quality:

• Proactive planning. Quality carriers will plan as much as possible for the impact of bad weather. They will anticipate customers’ scheduled shipments and collaborate to move them up or back to ensure the best result. They understand their customers’ unique needs – whether it’s making certain raw materials arrive to keep production rolling or ensuring on-time delivery to a key partner.

• Communication…lots of it. The best in the business will have an established line of communication (emails, website notices, hotline, etc.) for customers to receive updates on any developments, such as weather delays or equipment breakdowns.

• The pivot. Sometimes even the best hatched plans require a course correction. Carriers with quality systems in place and skilled staff will have the experience and flexibility to deftly pivot in adapting to changing situations.

The quality of your carrier should shine in the worst of conditions. How has yours measured up this winter?

Warehousing Insurance: Keeping Everyone Covered

The insurance coverages carried by a warehouse operator is one of the most commonly misunderstood elements of the relationship between the warehouse operator and the customer.

In addition to the normal business liability insurance coverages that most companies carry (e.g., commercial general liability (CGL), workers compensation, and motor vehicle), reputable warehouse operators also carry warehouse legal liability coverage. Warehouse legal liability coverage is a unique type of liability insurance policy that responds when a warehouse operator’s failure to exercise reasonable care in the handling and storage of a customer’s goods results in loss of, or damage to, those goods.

Warehouse legal liability insurance is third-party coverage

That means that if the warehouse operator is negligent in the care of the customer’s goods, the insurance carrier directly pays the customer for the loss incurred. For that reason, a customer cannot be, and does not want to be, named as an additional insured under the warehouse operator’s warehouse legal liability policy.

As a warehouse operator’s warehouse legal liability policy only pays a customer if the warehouse operator has been negligent in caring for a customer’s goods, the customer is still responsible for insuring its goods against other types of losses (e.g., fire, windstorm, etc.).

It is also important to note that virtually every warehouse legal liability policy excludes liability for loss or damage in instances where the warehouse operator has agreed to take on a higher degree of responsibility for the customer’s goods beyond what is legally required (i.e., “reasonable care”). This exclusion is necessary because warehouse legal liability policies are underwritten by insurance carriers on the basis of insuring the risks associated with the warehouse operator’s negligence. If a warehouse operator has agreed to assume greater liability for a customer’s goods, then the risks are obviously much more extensive than what the insurance carrier took into account when setting its premium.

In the event of significant loss or damage to the customer’s goods attributable to the warehouse operator’s failure to take reasonable care of the customer’s goods, both the warehouse operator and the customer depend on the warehouse operator’s warehouse legal liability policy to respond to the claim. As such, if a warehousing services agreement contains any provision that requires the warehouse operator to assume liability for a customer’s goods beyond the standard of “reasonable care”, then such a provision may void the warehouse operator’s warehouse legal liability coverage thereby putting both parties in an unfavorable position.