Q&A: What Is A Bill Of Lading?

athens-greeceA lot of things about the insurance world are Greek to an outsider (and often times the insiders as well). Fortunately at Wolpert we speak fluently.

Here is the first in a series of question and answer sessions trying to explain some of the more foreign ideas in the business, this one with Robert Nilsop in our South Easton office.

Q. What is a Bill of Lading (BOL)?

A. It is a special type of receipt issued by common carriers for property accepted for transportation

Q. My company, we’re a shipper, prepares b.o.l.’s utilizing our data processing system. We aren’t a carrier. Is this ‛legal’?

A. This can be somewhat confusing. Originally, carriers either typed b.o.l.’s from shipping orders prepared by their customers. Rather than delay the driver picking up the shipment both shippers and carriers found it more convenient to issue so-called “short form” b.o.l.’s which they gave the carrier’s driver to sign. Once the carrier’s representative – the driver – signed the shipper-prepared b.o.l., any mistakes are, by law, the carrier’s mistake(s).

Q. I noticed there are four or five copies. Why?

A. There is only one b.o.l., on long form b.o.l.’s it’s the [only] copy with terms and conditions printed on the reverse side. There are no terms and conditions on any copies of the short form. Often, the additional copies are identified by wording such as delivery copy, carrier’s copy, etc.

Q. My company utilizes our own b.o.l. with its own terms and conditions. Is this legal?

A. For tendering freight to motor carriers “yes” as neither Congress nor the Interstate Commerce Commission (ICC) ever imposed by statute ([Congress] or regulation [ICC] terms and conditions of a motor carrier b.o.l. as was the case for rail carriers. For motor carriers, who are not subscribers to the National Motor Freight Classification [a “master tariff” prepared by an independent organization for the benefit of member/subscribers], the motor carrier’s b.o.l. terms and conditions should be included in their service circular [“tariff”].

Q. Which name should be shown in the carrier area?

A. The carrier picking up the shipment. Frequently, motor carrier “A” will ‛broker’ [“subcontract] the line haul to another carrier (“B”). The shipper should show carrier “A” as the carrier and have the driver making the pick up write in – above the origin carrier signature area the name of the company represented (he could be an owner-operator), his name, the date and piece count or, if true, SL&C.

Q. Why insist that the pick up carrier follow this procedure.

A. Two reasons: (1) by doing so it “automatically” activates insurance coverage under “B’s” cargo insurance policy; (2) it provides prima facie evidence of “B’s” contractual to the shipper as a party to the b.o.l.

We hope this makes a little more sense of things. If you have any more questions or if there’s something you’d like us to cover in the future, leave us a comment.

And as always head over to Wolpert.com for anything else you might need.

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Published in: on October 29, 2009 at 1:20 pm  Leave a Comment  
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