Abandoned Cargo. Where is the Consignee?

The latest in the world of insurance

Posted 2018-07-25
With shippers and consignees going out of business at an alarming rate the risk of abandoned cargo is a real and potentially devastating reality. Demurrage & Storage charges multiply so quickly that forwarders cannot afford to lose time if they are held liable for these charges. They need professional insurers and lawyers to quickly act on their behalf to try and eliminate or mitigate the losses.  
The WCA FSL program contains a unique clause that helps to defend members when they are held legally liable for such cases. Below is a recent example of how World Insurance Services, the brokers for the WCA FSL program, and ITAL, the claims handling company for the program stepped in to assist on a recent abandoned cargo case.
“Containers of low-grade electrical products arrived in Rotterdam from China.  Despite various attempts to contact the consignee to pick up the cargo, it became clear the cost of storage/demurrage far exceeded the value of the cargo.  With this in mind, the insurance carrier issued a notice of abandonment to the parties on the bill of lading where the Freight Forwarder was named as “shipper”.  Whilst the Freight Forwarder was not the owner of the cargo they found themselves liable for over USD$20,000 worth of unpaid storage/demurrage and destruction costs. Liability insurers took this matter up with the carrier and reached an out of court agreement.”
As mentioned, it is imperative to act quickly in cases of demurrage and storage, if you put your head in the sand or simply don’t know where to turn, the problem can rapidly get out of control. Having proper insurance and a team that you can trust gives you the confidence to face these issues head-on and the resources to handle them properly. Fighting / Negotiating with the carriers can be a difficult, lengthy, expensive, and frustrating process, make sure you have the right protection and people in place to handle it for you.
Your coverage is only as good as the claims handling process!
To learn more about the WCA Risk Managed program and how to increase your peace of mind, please send us a note at: customercare@worldinsuranceagency.com