Why Asian Insurers Should Be Partnering with Arete Adjusting for U.S. and North American Claims Management

For insurers in the Asian market doing business in the U.S. or North America, managing claims and navigating the intricacies of these markets can be challenging. Ensuring that claims are handled efficiently, losses are mitigated, and local regulatory standards are met requires a reliable and experienced partner on the ground. This is where partnering with Arete Adjusting, a Third Party Administrator (TPA) specializing in logistics/marine cargo and liability claims management, provides valuable support.

Arete Adjusting is based in North America and focuses solely on delivering quality outcomes for our clients. Our expertise lies in end-to-end claims management, leveraging our deep local knowledge and well-established relationships with key figures in the claims process, such as brokers, loss adjusters, legal entities, and co-insurers. By partnering with us, Asian insurers gain a trusted local presence that ensures seamless handling of their North American claims portfolios.

Challenges of Managing North American Claims from Asia

For insurers and underwriters based in Asia, managing claims in the U.S. or broader North America presents several challenges. Time zone differences, varying legal frameworks, cultural distinctions, and a lack of local market insight can all lead to delays in claims resolution and inefficiencies in communication. Without an experienced partner on the ground, insurers risk incomplete claims processing, mismanaged recoveries, and unsatisfactory outcomes for their clients.

Partnering with Arete, clients remain informed and abreast of emerging risks that the marine/logistics industry is experiencing in real-time, which may be hard to identify from Asia.

One of the most significant issues is navigating the legal complexity of the U.S. and North American logistics sectors. Regulations and liability standards can differ drastically between regions, and insurers need a partner who understands these nuances to ensure compliance and successful claim outcomes. Arete Adjusting brings this local expertise to the table, ensuring that claims are handled in accordance with the highest standards.

Arete Adjusting: Your Local Expert in North American Claims

Arete Adjusting provides comprehensive claims management services, including surveying, technical investigation of losses, legal review, loss adjusting, and pursuing recoveries against third parties. Our international network of partners and in-house experts ensures that every claim is thoroughly assessed, documented, and resolved efficiently.

For example, we recently assisted an Asian insurer in a particularly challenging situation involving coverage denials. In the U.S., insurance regulations vary by state, meaning denial letters must be tailored to meet state-specific legal standards to avoid potential legal consequences. We worked closely with the insurer to draft legally compliant letters, ensuring that all denials met the necessary state regulations. Additionally, we helped explain the outcomes locally to the claimants, making the process smoother for everyone involved. Denials are always difficult, but we felt that our involvement was especially appreciated in this instance, as it helped the insurer navigate the complexities of U.S. regulations and provided clarity for the claimants.

The Benefits of Partnering with a U.S.-Based TPA

  1. Local Expertise: Arete Adjusting provides on-the-ground knowledge of U.S. and North American markets, helping Asian insurers navigate the complexity of claims processing in these regions.
  2. Seamless Communication: Time zone differences and communication delays are minimized, with a local partner handling claims in real time, ensuring smooth and efficient processes.
  3. Comprehensive Claims Management: From initial survey to final recovery, Arete Adjusting manages the entire claims process, offering Asian insurers peace of mind that their North American claims portfolios are handled with care.
  4. Customized Solutions: Every insurer has unique needs, and Arete Adjusting works closely with each client to tailor our services to meet those requirements.
  5. Sustainable Results: By providing consistent, high-quality outcomes, Arete Adjusting helps Asian underwriters build more profitable and sustainable portfolios.

Why Asian Insurers Should Consider Arete Adjusting

Partnering with Arete Adjusting is a strategic move for insurers in Asia who manage claims in the U.S. or North America. Our in-depth understanding of local markets and our international capabilities mean that insurers can trust us to deliver quality outcomes for their clients. Whether it’s handling claims in the logistics sector or providing technical investigations and legal reviews, we offer a comprehensive solution that supports your business goals.

Businesses should keep in mind that in the US, there can be serious repercussions when US insureds file complaints with the State Department of Insurance (DOI) over their claim. If these State DOIs find that domestic/overseas insurers are not using licensed adjusters, it could lead to fines and reputational damages. Arete Adjusters are licensed across the US and are compliant with State Adjuster licensing requirements.

We understand the challenges that insurers face when operating across borders and are committed to simplifying the process for you. Arete Adjusting acts as your local partner, ensuring that you remain informed and in control without managing the complexities of claims processing from afar.

Looking to simplify your North American claims management? Contact Arete Adjusting today to discover how we can act as your trusted partner and ensure seamless claims handling for your business.

Posted in Claims, UncategorisedTagged in , , , ,

Protecting Your Cargo: The Importance of Accurate Documentation on Ocean Bills of Lading

In the world of international shipping, few documents are as critical as the ocean bill of lading (BOL). Serving as the contract of carriage between the shipper and carrier, this document not only outlines the terms of the shipment but also plays a crucial role in resolving claims when issues arise. For direct shippers, accurately declaring cargo piece counts on the B/L is vital to protecting their investment and avoiding costly errors.

The Impact of Inaccurate Documentation

One of the most common mistakes direct shippers make is allowing freight forwarders to declare the number of pallets instead of the individual pieces of cargo. Liam, CEO of Arete Adjusting, pointed out how this can negatively impact a shipper’s ability to file claims if something goes wrong. “I’ve seen claims not have their fullest outcome in the event of a loss because freight forwarders are putting the number of pallets, not necessarily the individual pieces of cargo,” Liam noted.

This distinction is crucial, especially considering that a carrier’s liability in ocean freight is often limited to around $500 per package. By documenting the number of pallets, shippers may unwittingly limit their recovery in the event of a claim. For instance, a shipment consisting of 13 pallets may actually contain thousands of individual items (cartons, drums, barrels, etc.), but if the B/L only lists the pallets, compensation in the case of damage or loss will be calculated based on those pallets—not the actual number of pieces.

Avoiding Claims Pitfalls: A Closer Look at Bills of Lading

Accurately identifying the cargo on the B/L is not just about ensuring proper liability coverage; it’s also essential for meeting customs requirements. Each country has its own import regulations, and failure to properly count and describe the cargo can lead to costly delays, fines, or even refusal of entry. This is particularly important when shipping high-value or sensitive goods.

For cargo bound for the United States, CBP regulations require the smallest individual unit of packaging be reflected not just on transport documents, but for electronic manifest and admissibility filings to the agency as well.

Freight forwarders are responsible for understanding the specific requirements of each destination country, but direct shippers must also take an active role in ensuring accuracy. While forwarders are often aware of country-specific regulations, they may not always provide the level of detail needed on the B/L, particularly when it comes to itemizing pieces of cargo.

Shippers should be proactive in reviewing the B/L draft before the document is issued. Double-checking that the actual number of pieces—not just the number of pallets—is clearly stated can prevent misunderstandings with customs authorities and reduce the risk of complications down the line.

Practical Tips for Shippers

Based on Arete Adjusting’s experience in handling claims for direct shippers, here are some key steps you can take to protect your cargo:

  1. Review the Draft B/L: Before your shipment is finalized, carefully review the draft BOL to ensure that the number of pieces of cargo, rather than just the number of pallets, is accurately documented.
  2. Work with Knowledgeable Forwarders: Choose a freight forwarder that is experienced in navigating international customs regulations. Freight forwarders connected to networks like the WCA are better equipped to handle complex documentation requirements.
  3. Understand Carrier Liability Limits: Be aware of the carrier’s liability, which can often be limited to a specific amount per package. Ensuring that each piece of cargo is properly accounted for on the B/L can help protect your rights in the event of a claim.
  4. Communicate with Your Forwarder: Maintain open communication with your freight forwarder to ensure that they understand the specific nature of your cargo and how it is packed, if there are overpacks involved and what quantity is being reported on both documents and in electronic declarations. This includes making sure they are familiar with the customs requirements of your destination country.

By following these steps, direct shippers can better protect their cargo and avoid the risks associated with inaccurate documentation.

At Arete Adjusting, we’ve seen firsthand how small mistakes in documentation can lead to big problems for shippers. Accurate bills of lading are critical for ensuring the proper handling of claims and avoiding delays with customs authorities. By taking a proactive approach and working with experienced partners, direct shippers can safeguard their cargo and reduce the likelihood of costly errors.

If you need guidance on navigating claims or ensuring your documentation is in order, Arete Adjusting is here to help. Our experience in handling claims for direct shippers allows us to provide expert advice and support every step of the way. Reach out today to learn how we can assist with your shipping needs.

Posted in Claims, UncategorisedTagged in , , , , , , , , ,

Understanding Subrogation: A Crucial Aspect of Insurance Claims

subrogation

Understanding Subrogation: A Crucial Aspect of Insurance Claims

When it comes to insurance, the terminology and processes can sometimes be complex and difficult to navigate, especially during a claim. One term that often arises but may not be fully understood by policyholders is “subrogation.” At Arete Adjusting, we believe that understanding subrogation is essential for the insured.

What is Subrogation?

Subrogation is a legal principle in the insurance industry that permits an insurer to assume the rights of the insured once a claim has been settled. Essentially, after compensating the policyholder for their loss, the insurance company can seek to recover the costs by pursuing a third-party responsible for the damage. This process helps insurers recover some or all of the money they paid out to their policyholder, while also ensuring that the responsible party is held accountable.

For example, if a policyholder’s property is damaged by a third party—such as in a car accident where the other driver is at fault—the insurer will cover the policyholder’s claim. After the claim is settled, the insurer may then pursue the at-fault party or their insurer to recover the costs. This pursuit of recovery is subrogation.

Why is Subrogation Important?

Subrogation plays a vital role in the insurance ecosystem for several reasons:

  1. Cost Recovery: It allows insurers to recover funds, which can help keep insurance premiums lower for all policyholders. By pursuing the responsible party, insurers can offset the costs of claims.
  2. Accountability: Subrogation ensures that the party responsible for the loss is held accountable, rather than the loss being absorbed by the policyholder or the insurer.
  3. Fairness: It promotes fairness by ensuring that the party who caused the damage is ultimately responsible for the costs, rather than spreading those costs across all policyholders.

How Arete Adjusting Can Simplify the Process

The subrogation process can be complex and time-consuming.  At Arete, we consider subrogation at the onset and during a claim, not just at the end. By addressing subrogation during the entire claim process, we are affording insurers and their policyholders the best possible recovery.

By partnering with Arete Adjusting, insurers can benefit from:

  1. Expertise: Our team has extensive experience in subrogation, ensuring that every opportunity for recovery is explored and pursued effectively.
  2. Efficiency: We streamline the subrogation process, reducing the time and resources needed from the insurer’s side, allowing them to focus on providing top-notch service to their policyholders.
  3. Flexibility: Arete Adjusting doesn’t need to handle the entire claim process to assist with subrogation. Whether we manage the initial adjustment or just the subrogation, we offer flexible solutions tailored to the insurer’s needs.

Making Life Easier for the Insured

For policyholders, dealing with a claim can be stressful. They also must know when a company like Arete can step in and help.

All insurers want to be notified of a claim, even when the claim value is under the deductible. The difference between claims exceeding a deductible versus ones beneath is that if the claim is over the deductible, the insurers will do all the work. Beneath the deductible, the insured customarily proceeds alone. 

Arete can work with policyholders when there is a high dollar deductible and they lack either an in-house team or the experience to pursue the claim. For instance, if a policyholder has a $100,000 deductible and an $80,000 claim, Arete can provide advisory and technical assistance. 

By choosing an insurer that works with Arete Adjusting, policyholders can rest assured that their insurer is backed by a team of experts who will handle the subrogation process smoothly and efficiently. This means faster resolutions, better loss ratios, less hassle, and peace of mind for the insured.

Subrogation is a critical aspect of the insurance claims process that benefits both insurers and policyholders. By recovering costs from the responsible party, insurers can maintain fair pricing, and policyholders can avoid the financial impact of a claim. Arete Adjusting’s specialized services offer a streamlined, efficient solution that allows insurers to focus on what they do best while ensuring the process is handled expertly.

Contact us today to learn more.

Posted in UncategorisedTagged in , , ,

Freight Forwarders Liability Insurance on Air Freight: Why It’s So Important

If you are an Air Forwarder, you may ask if Freight Forwarders Liability (FFL) Insurance is worthwhile. Why is it needed, as airlines carry most of the risk when an incident happens?

FFL Insurance played an important role in protecting in the following examples:

Wrongful Destination Claim

Due to an administration error, a shipment was air freighted to London, Canada instead of London, England. The Freight Forwarder incurred charges to ship the cargo back to its correct destination, and those fees (over USD 20,000) were covered by insurers.

Customs Fine

Due to an employee mistake on documentation, a cargo shipment was delayed at its destination in South Africa and received a customs fine. This was covered by insurers, who handled the delay claim plus the fine.

Damage to Cargo

Whilst most claims can be passed to the airline, airlines are notorious for not responding. It is common for the merchant to sue the Forwarder rather than wait for a response from the airline. In one instance, Lufthansa failed to respond for a time extension received from a cargo insurance company for USD 50,000 of food products deteriorated in transit. Insurers appointed lawyers and settled the claim whilst a recovery action was taken against the airline.

FFL Insurance is designed for Freight Forwarders and Forwarders only. In today’s world, the Forwarder is expected to bear a much greater risk than previously, and most service contracts go against them. This may extend to customs fines, uncleared cargo, damage to cargo, or aircraft and documentation errors.

Most of the claims are defending the insured, and the policy is there to cover the costs in doing this, either through the appointment of lawyers, surveyors, or their in-house legal team. Defence Cover is from the ground up, so unless a claim is paid, all the legal fees are paid by insurers.

If and when a claim needs to be paid, it is often expensive in the air freight business. Cargo and freight values are often much higher than sea freight, so claims from the merchant, E&O matters, or customs fines are also high. Insurers have paid claims from USD 2,500 to over one million dollars, and we have seen Forwarders go bankrupt without insurance. This is not cargo insurance but protection for the Forwarder.

FFL Insurance covers not only claims arising from your customer, but also the airlines. In the event of leakage, poor packing, or even explosion, the airline will come against the Forwarder. This can be costly from the claim but also commercially, as we have seen multiple Forwarders blacklisted for this. Your insurers will not only handle these claims, but also ensure you have adequate protection to stop unreasonable demands.

FFL Insurance offers protection against claims arising from your customer and airline, as well as errors committed by your employees. It is designed for Freight Forwarders, so not only is the defence cover from the ground up, but the wording is bespoke to independent Forwarders.

Please contact our specialists: info@areteadjusting.com.

Arete Adjusting, LLC is a member of the +8 Partners ecosystem.

Disclaimer: All claims are subject to the terms, conditions and exclusions of the relevant product disclosure statement and/or policy.

Posted in Uncategorised

What Makes a Contract Special?

From a risk management perspective, this question is answered by the contractual terms that make the policy holder pay more when they have a claim compared to when standard trading conditions apply.

Standard trading contracts are often taken from other industries that are unsuited to the transportation and logistics sectors. Signing these contracts can lead to significant financial losses, the possibility of no insurance coverage, and even bankruptcy.

The following scenarios found within standard contracts are important to pay attention to, as they can have very high-risk outcomes for the policy holder:

“You are responsible for all claims.”
What it means: Strict liability regardless of any fault or negligence.

“You are responsible for the full value of the cargo.”
What it means: No weight or package limitation, including high value cargoes.

“You are responsible for delays and consequential losses.”
What it means: No limit to freight charges and time crucial delivery.

“You have no defenses to claims.”
What it means: No reference to protection for matters beyond your control.

“You have no recovery against responsible carriers.”
What it means: Certain clauses make you fully responsible for all carriers in the chain.

“You agree to a claimant supportive legal system.”
What it means: Certain legal regimes are less favorable to logistics providers.

For More Information

Please contact our specialists: info@areteadjusting.com.

Arete Adjusting, LLC is a member of the +8 Partners ecosystem. This article was authored by Phillip Emmanuel, Chief Operating Officer at +8 Partners.

Disclaimer: All claims are subject to the terms, conditions and exclusions of the relevant product disclosure statement and/or policy.

Posted in UncategorisedTagged in , , , ,

The Importance of Salvage

If you have a claim under your cargo or liability insurance, salvage can be a major headache for the forwarder.

When an accident occurs, the merchant is understandably upset. Their cargo is damaged, but there also may be other implications to the supply chain. Often, they will prefer to abandon the cargo and re-order a new shipment. Such behaviour can be extremely costly for both merchant and even the forwarder.

The forwarder must ensure they try to get the cargo to destination before arranging any survey or inspection. If an incident happens in the port and the cargo is deemed damaged, the merchant will most likely not want their cargo. And may not want to spend time salvaging with the belief that this is the cargo insurer’s responsibility under subrogation.

However, this is not the case. The duty to mitigate/salvage is on the merchant – not the insurer. Subrogation is only after the insurers have settled the case.

This misunderstanding may result in expensive storage / demurrage / disposal / labour charges that insurers are unlikely to compensate. Therefore, we would always recommend ensuring the cargo arrives at destination before any survey is undertaken.

Any delay may also prejudice the claim, especially if it involves perishables. The insurer’s surveyor may help, but if the merchant refuses to cooperate, then this will be a total loss in a very short time. Whilst insurers will not override a decision by the health department to condemn cargo, often the discretion is on the insurer to decide. Perishables may be condemned for human consumption, but they will have a secondary market under animal feed, and this is where complications occur. There is still salvage, and it is not deemed a total loss.

Ultimately, speedy action on finding salvage buyers results in the claim being paid faster with less costs. It’s also common for the merchant to make a salvage offer for cargo that may fall outside its original market, but they still have a use for. This can make adjusting the claim even quicker and simpler.

Salvage is the number one reason for delay on claims adjusting, so it is imperative to involve the broker as soon as a dispute arises.

For questions or more information regarding salvage, please contact our specialists: info@areteadjusting.com.

This article was written with +8 Partners member company World Insurance Services, Inc. and authored by Richard Kamppari Baker, Claims Director at World Insurance. Arete Adjusting, LLC is a member of the +8 Partners ecosystem.

Disclaimer: All claims are subject to the terms, conditions and exclusions of the relevant product disclosure statement and/or policy.

Posted in UncategorisedTagged in , , , ,

Litigation Funding and Talent Shortages

“Big issues for the industry says this new arrival”.

Arete Adjusting recently launched operations in North America, fixing its sight on the marine and logistics insurance market.

In an interview with Insurance Business America, Arete’s CEO, William (Liam) Richards, discusses the decision to enter North America and the need for a better claims adjusting experience.

Click here to read the full article.

Posted in UncategorisedTagged in , , , , ,

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