When it comes to moving across country, or across state borders, when hiring an interstate mover, you should know your rights when it comes to paying for your move.  A situation came up in May 2010, when a family’s possessions were destroyed by a fire during transit.  All the family was left with was a sofa, table, and a couple beds.  The family had put a down payment on their move of $2365, but unfortunately the truck never made it out of the state because it was completely destroyed. The moving company did put an insurance claim in, but since the shipper opted for the minimum coverage of valuation, the legal obligation of the mover was minimal.  This would have been a different story had the shipper opted to take out additional valuation on their interstate move.  To read more on the tragedy that happened to this family, check out this article Cross Country Moving Catastrophe. 

The point of this article is to illustrate how on an interstate shipment, the moving company is forbidden from collecting shipping charges if the shipment is a total  loss during transit, according to the FMCSA regulation 375.709.  There are 2 exception that apply:

The customer is responsible to pay for any valuation charges taken out.

This regulation is VOID, if the loss was due to the shipper's negligence. 

With that being said, the moving company in the above article is required to refund the shippers deposit.  The 2^nd point of this article is to know your insurance rights (and make sure you understand all options, and consequences, if you choose not to take out additional coverage).  Check with your homeowners insurance (which may sometimes cover your move), and make sure you ask all of these questions before hiring a mover.  If the shipper in the above article would have taken out additional valuation (coverage) on her move (which would have cost them only an additional $300), she would have been paid $35,000, which is much better than ending up with a few pieces of furniture and a suitcase.

The regulations governing a mover’s contractual liability for the value of your goods vary among the states, so if you are moving locally within your state, please be sure to learn about the options available for your move.  

If you are moving from one state to another, the mover’s liability that will apply is governed by Federal regulations.  All interstate moving companies are required to assume liability for the value of the goods that they transport.  However, there are two different levels of liability that apply and you should be aware of the charges that apply and the amount of protection provided by each level.  The two different levels of liability that movers are required to provide are explained below and in the Your Rights and Responsibilities When You Move brochure that your mover will provide to you.  Be sure to read this information carefully and follow the instructions provided to declare a value on your shipment. 

FULL (REPLACEMENT) VALUE PROTECTION.  This is the most comprehensive plan available for the protection of your goods.  Unless you select the Alternative Level of Liability described below, your shipment will be transported under your mover’s FULL (REPLACEMENT) VALUE level of liability.  If any article is lost, destroyed or damaged while in your mover’s custody, your mover will, at its option, either 1) repair the article to the extent necessary to restore it to the same condition as when it was received by your mover, or pay you for the cost of such repairs; or 2) replace the article with an article of like kind and quality, or pay you for the cost of such a replacement.  An additional charge applies for this service; if you do not wish to pay this additional charge, you must select the alternative level of liability described below.

 The exact cost for full value protection will vary by mover and may be further subject to various deductible levels of liability that may reduce your cost.  Ask your mover for the details of their specific plan.

Under this option, movers are permitted to limit their liability for loss or damage to articles of extraordinary value, unless you specifically list these articles on the shipping documents.  An article of extraordinary value is any item whose value exceeds $100 per pound (for example, jewelry, silverware, china, furs, antiques, oriental rugs and computer software).  Ask your mover for a complete explanation of this limitation before your move.  It is your responsibility to study this provision carefully and to make the necessary declaration.

 ALTERNATIVE LEVEL OF LIABILITY – Released Value of 60 Cents Per Pound Per Article.  This is the most economical protection available; however, this no-cost option provides only minimal protection.  Under this option, the mover assumes liability for no more than 60 cents per pound, per article.  Loss or damage claims are settled based on the pound weight of the article multiplied by 60 cents.  For example, if a 10-pound stereo component, valued at $1000 were lost or destroyed, the mover would be liable for no more than $6.00 (10 pounds x 60¢).  Obviously, you should think carefully before agreeing to such an arrangement.  There is no extra charge for this minimal protection, but you must sign a specific statement on the bill of lading agreeing to it.

 These two levels of liability are not insurance agreements that are governed by state insurance laws, but instead are contractual tariff levels of liability authorized under Released Rates Orders of the Surface Transportation Board of the US Department of Transportation.

 Some movers may also offer to sell, or procure for you, separate added liability insurance if you release your shipment for transportation at a value of 60 cents per pound per article (the Alternative Level of Liability).  This is not valuation coverage governed by Federal law, but optional insurance that is regulated under state law.  If you purchase this separate coverage, in the event of loss or damage which is the responsibility of the mover, the mover is liable only for an amount not exceeding 60 cents per pound per article, and the balance of the loss is recoverable from the insurance company up to the amount of insurance purchased.  The mover’s representative can advise you of the availability of such liability insurance and the cost.  If you purchase this separate liability insurance from or through your mover, be sure to get a copy of the policy or other document at the time of purchase.

When using movers, whether it is corporate movers, or starving student movers, every mover is responsible for liability for the value of goods when they perform your move.  There are different levels of liability and the customer should be aware of the different options that are available to them and different levels of protection available.  Most movers, even the meathead movers, will offer anywhere from 2-4 levels of protection depending on their tariffs and according to the Surface Transportation Boards Orders which is the governing body of the moving industry.

OPTION 1:  RELEASED VALUE:  This is the least expensive option for the consumer.  This is provided to the consumer at no additional charge.  Under this plan, the mover takes responsibility for no more than 60 cents per lb per article.  Claims whether if it a damage or loss are settled on a per lb basis.  For example if you have a 200lb piece of furniture that is a complete valued of $1000, and is damaged or lost, all you are entitled to would be $120 with this option.  This option is very limited, and you should weigh all of your options before selecting this option.

OPTION 2:  DECLARED VALUE:  Under this plan the total pounds of the shipment is  x $1.25 per pound.  For example a 2000lb shipment has a maximum liability of $2500.  And damage or loss under this plan is based on depreciated value of the item.  Under this plan if you had piece of furniture that was 10 pounds, and was originally valued at $500, the mover would be liable for up to $500 based on depreciated value of the item.  If you do not agree to other terms of valuation, the mover must assume liability based on the whole shipment under this option.  Also the mover will charge you $7.00 per $1000.00 of liability assumed for moves under this plan.

$5000.00 of depreciated value= $7.00×5=$35.00 (this is what you pay under this protection).

With this option your items are covered based on depreciated value.

OPTION3:  LUMP SUM VALUE

This option is similar to option 2 but the value of your shipment must exceed $1.25 per pound times the pounds of your items being moved.  You can purchase additional liability from your mover.  You must designate a dollar amount for the shipment.  IF you have pieces that are high value items, you may wish to choose this option.  You must also indicate this in writing on the bill of lading prior to your movers starting your move.

OPTION 4:  FULL VALUE PROTECTION/FULL REPLACEMENT VALUE:

Many movers will offer this level of protection known as full replacement value, or full value protection.  This is the most expensive, and there may or may not be a deductible involved with this (usually $0, $250, or $500).  If you have full replacement coverage, and the item in question is lost or damaged, items will get repaired, replaced or cashed out for current market value.  Depreciation does not come in effect with this option.

If a moving company doesn’t offer this option (probably because of a local move) some states will not allow full replacement value for local moves, there are 3^rd party brokers that will sell this.