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E&O INSURANCE 101 AND NEW EXPOSURES

E&O INSURANCE 101 AND NEW EXPOSURES. Presented By: Jason Wieselman 09/18/2013. WHAT IS E&O/CARGO LEGAL. An unforeseen Act, Error, or Omission made by the insured that directly contributes to financial loss suffered by a 3 rd party.

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E&O INSURANCE 101 AND NEW EXPOSURES

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  1. E&O INSURANCE 101 AND NEW EXPOSURES Presented By: Jason Wieselman 09/18/2013

  2. WHAT IS E&O/CARGO LEGAL An unforeseen Act, Error, or Omission made by the insured that directly contributes to financial loss suffered by a 3rd party. An amount the insured is held Legally Liability for under their own bills of lading, while acting as an NVOCC, Warehouseman, Domestic Property Broker, or Air/Ocean Freight Forwarder, Delivery Agent. *** (Damaged machinery 40k NVO was Sued, Ocean Carrier exercised Tokyo selection clause 8k legal still open)

  3. WHO NEEDS E&O INSURANCE • Doctors (malpractice) • Financial Planners • Attorneys (Professional Liability) • Insurance Agents • Forwarders and Brokers • Every time you issue an invoice, you can be named in the event of loss or damage.

  4. WHAT IS COVERED (Generally) COVERED • Wrongful Release *** • Misdirected Cargo *** • Temperature Settings *** • Classification Errors *** • BL Exposure • Failure to Notify *** • NOT COVERED • Willful Acts • Commercial Disputes • Illegal Activity

  5. IMPORTER SECURITY FILING (ISF) • Cargo Holds (demurrage, delays, loss of market, perishables) • Penalties (3rd party exposure) • Clarify your role with importers to avoid confusion. (are you handling the ISF or is the forwarder?) • ISF Penalties have been issued!

  6. DOMESTIC LOAD BROKERING E&O (endorse current policy to include domestic load brokering) Contingent Cargo Contingent Auto Negligent Hiring of Truckers *** Risk/Reward if not licensed as a Property Broker

  7. PAID CLAIMS Importer sued CHB for charging 300k in duties over 3 years for goods that were duty free. 220k recovered from CBP.– 5k deductible – 6400 legal -75k paid 64k Furniture shipment released without the original BL. 5k ded. 59k paid – 3600 legal CHB sued for 2Million for failing to validate a POA from a FF which lead to distribution of counterfeit merchandise. 44k legal 45k settlement Sushi Grade Tuna shipment set at wrong temperature. 113k value – deductible 5k – 109k paid. Can you afford E&O?

  8. TIPS FOR AVOIDING LIABILITY • VALIDATING POA’S (call importer to verify) • WAREHOUSE RECEIPTS • DOCUMENT EVERYTHING • UNDERSTAND THE RISKS OF AD/CVD • TERMS & CONDITIONS(website, emails, invoice) • FORCE SHIPPERS TO ACCEPT OR DECLINE MARINE INSURANCE • CONTRACTS (show your broker before accepting) • WAREHOUSE PERSONNEL

  9. IN CONCLUSION • Talk to your Broker about your operations • Evaluate the cost/sales ratio to carry coverage • Know what policy is right for you. • Educate your staff about taking on new business • Get procedures in place • Grow your company safely by protecting your bottom line and your personal interests.

  10. QUESTIONS? WWW.INTLBONDMARINE.COM

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