Federal law says that motor carriers of household goods are ordinarily liable for the actual loss or damage they cause to property they transport. However, carriers may established “released rates,” which limit their liability to a value established by written declaration of the shipper or by a written agreement between the carrier and shipper -- if they first obtain permission from STB. Carriers of freight other than household goods don’t need to obtain STB permission for released rates.
Under the current rate plan, approved by the Interstate Commerce Commission in 1993, carriers may offer three options: A shipper can agree to limit the carrier’s liability to 60 cents per pound per article and pay the carrier’s lowest or “base rate.” A shipper may increase the carrier’s liability to actual (depreciated) value and pay the base rate plus 70 cents for each $100 of declared value with a minimum value of $1.25 times the shipment weight. Or the shipper can opt to pay an even higher charge for “full value protection,” which essentially makes the carrier responsible for full declared replacement value of the shipment.
The Household Goods Carriers’ Bureau has proposed to eliminate the second option. Customers would either pay base rate for 60 cents-per-pound carrier liability, or choose full value protection. There would be no depreciated value option, and the minimum declared value would increase from $1.25 to $4.00 times the weight of the shipment.
A more detailed explanation of the proposed changes appeared in the Nov. 9 Federal Register available on the Internet at www.nara.gov/fedreg. Comments are due Dec. 11, 2000.