After twenty years the government has recently increased the limit of liability on the Carriage of Goods Act from $1,500 to $2,000. This means when your goods are transported by a carrier, such as a courier, if something is lost or damaged you may be able to claim compensation up to the new limit of $2,000.
The Act is a great piece of legislation on the whole, and provides some protection for almost anyone moving anything around the country, from Trade Me auction wins to heavy machinery.
But, beware, it should not replace an insurance policy. This is for two reasons:
Firstly, the limit applies on a per unit basis. Generally speaking, the unit is defined as the package as handed to the carrier. This means that if you put 20 boxes onto a pallet and the carrier collects the pallet, the unit is the pallet, not each box. So the most you can get back if it's damaged is the limit of $2,000.
Secondly, the carrier isn't liable in all circumstances - such as if they try to avoid an accident and crash their truck, destroying the cargo, there is no liability. Likewise, they can't be held responsible if you don't pack items properly for transit.
And sometimes Limited Carriers Risk does not apply at all!
It's worth pointing out the 'Limited Carriers Risk' (or LCR) doesn't always apply. For example, almost all carriers won't carry household goods and personal effects on LCR terms. Most make it 'At Owners Risk', meaning they carry on an 'all care, no responsibility' basis. Carriers and customers can also amend the limit and terms on a case by case basis subject to negotiation.
So if you're moving items by carrier, it's important to understand that when a carrier says they have insurance, this doesn't mean the insurance is for you - it's for the carrier's protection. It might be best to arrange your own transit cover when you move house or a business might need local cargo cover or an extension on their material damage policy.
Having your own transit insurance will get a claim settled faster than trying to deal with a carrier. And it will ensure you get financial compensation for any items lost or damaged, with no shortfall.
By Tim Wilkes, previously Commercial Broker @tim wilkes
About the AuthorName: Rothbury
Like many of our business insurance clients we're a majority NZ owned company that was started by enterprising Kiwis in 1950. Today, New Zealand is a different place to when we first started. As a consequence, the way…
Like many of our business insurance clients we're a majority NZ owned company that was started by enterprising Kiwis in 1950. Today, New Zealand is a different place to when we first started. As a consequence, the way we respond to your business and personal protection needs has evolved and matured.
While our core business is still related to creating the best insurance solutions for you, our motivation and passion now lie in being unconditional advocates for our diverse range of clients. In other words people like you.Close