How to check a freight forwarder before you ship

Licensing

The Federal Maritime Commission issues licensure to ocean transportation intermediaries, covering NVOCCs and ocean freight forwarders, to those demonstrating compliance with regulatory standards. It also ensures compliance with the Shipping Act through reviews of business records and practices.

So there is a licensing status to ask about and an agency to verify it with. Ask which category the company operates in and confirm it with the agency rather than with the company.

Whose bill of lading

This is the question most shippers never ask and it decides who you claim against. An NVOCC issues its own bill of lading and stands as carrier to you; a forwarder acting as agent does not.

Ask whose bill you will hold and to see the terms on the reverse before booking, not after the cargo has sailed.

Trading conditions

Intermediaries contract on standard trading conditions that limit liability, often sharply and often by weight rather than by value. A pallet of electronics and a pallet of sand can carry the same liability cap.

Read the limit. If it is materially below the value of your cargo, that is not a reason to avoid the forwarder; it is a reason to insure.

Insurance

Cargo insurance is usually not included unless you asked, and carrier liability is not insurance. Ask whether cover is included, at what limit, and on what terms.

Then check what the policy actually responds to. General average, delay and inherent vice are all places where an assumption and a policy part company.