Chapter 6 - Risk Management

1)Risk Management is all about:

A) Adequate insurance

B) Preventative Planning

C) Effective Claims Processes

D) Managing Goods in Transit

2) When initiating a claim, there is one primary document used to establish the

conditions of liability. That document is:

A) The Carrier Claims Form

B) The Incoterm

C) The Sales Contract

D) The Bill of Lading

3) A shipment arrives at your door damaged. What should you do?

A) Send it back to the shipper and have them deal with the claim.

B) Refuse it and call the carrier

C) Accept it, isolate it in the building and begin the claims process

D) Accept it, take out what you can use and then begin the claims process

4) Claims can be filed by anyone legally entitled to the goods. What terms typically

determine who would file a claim?

A) Incoterms

B) Terms of Sale

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C) The Bill of Lading

D) FOB Origin

5) I make a product that costs me ten dollars. I sell it for one hundred dollars. I ship it.

The carrier admits they broke it beyond repair and will pay for it. How much can I claim?

A) 90 Dollars

B) 100 Dollars

C) 10 Dollars

D) 110 Dollars

6) When does carrier liability for a shipment end?

A) When a claim is initiated in writing to all parties

B) When product is delivered and signed clear by the receiver

C) When product is picked up and the BOL is issued to the carrier

D) When the product is given to another/interlining carrier

7) You ship a load of steel by road on a flat bed trailer that weighs 35,000 pounds. It is

worth fifty thousand dollars. While in transit, the load flips and the product is destroyed.

Shipping charges aside, how much can you claim for?

A) $70000

B) $35000

C) $50000

D) $85000

8)How could Insurance impact claims planning and management decisions?

A) The cost and nature of insurance coverage may dictate modes used.

B) Since we insure for the value of product, Insurance should not be a

consideration in logistics decisions

C) We issue all of our terms of sale such that the consignee deals with insuring

goods, so we are not affected

D) Since we have a good claims record, we should methodically reduce our

coverage and therefore costs.

9) What happens to freight charges in a claim where the carrier is found liable?

A) They dont need to be claimed for as the party paying the bill should simply

not pay that freight invoice

B) They should be paid and will be refunded as claimed in the original claim to

the carrier

C) They dont need to be claimed as the freight charges were deducted from other

freight invoices long before the claim was settled

D) They should be paid and the carrier should be sued for those freight charges

plus applicable legal fees/costs after all other claims amounts are settled and paid

for.

10) Time limits noted on the BOL for submitting written intention to claim:

A) Are typically the same as the time limits for formally filing a claim

B) Are the same for all modes

C) Are not the same as the time limits for formally submitting a claim

D) Can be legally changed by the carrier transporting the shipment