RELO Roundtable…a gathering place

Hopefully you’ve read this far.

This will be good practice for reviewing the three quotes you will be getting as part of your international move, as well as all of the other documentation which comes along with the cost estimates.

Here are a few other things to keep in mind.

 

Get Everything in Writing

Once you have read the pricing, the terms and conditions, and everything else, you will have questions.

There may also be specific services you require, or want as part of your household goods move. .

If it is important, get it in writing. If it is not in writing, it doesn’t exist!

In the event of a dispute, the first thing that will be reviewed is the written agreement and other written correspondences.

It’s a good idea to follow up phone conversations with an email, to make sure there is no confusion, and to make sure that you get a response, in writing, from the International Shipping Company that matches your needs, wants, and expectations.

 

 

Insurance/Valuation/Coverage

Depending on which International Shipping Company you choose, the name of insurance may vary, but there are some basic things you need to know:

• Insurance is never included in the cost.
• The cost of insurance is based on the amount of insurance you need, and the deductible you choose.
• Insurance can be either “Total Loss” or “All Risk”.
• If your goods are not insured, you can not claim damages, even if you see the worker drop the box!
• Insurance is based on you insuring your entire shipment, for what it costs to replace new, in the country of destination.
• You will need to make a list of what you are shipping, and how much it will cost if you have to replace it new, in the country of destination.

This may seem a little odd, so I’ll try to explain the reasoning this way. 

Your cargo is probably worth much more than the cost of shipping it. If it wasn't, you probably wouldn’t pay to move it. However, the International Shipping Company has no way of knowing what the value of that cargo is. (Remember, most cargo is commercial.) Considering the average profit on a given shipment, the value of the cargo is usually way, way more than the profit.

Obviously, the International Shipping Company will need to use an outside Marine Insurance Company to cover against loss or damage.

Since the value of a given volume of cargo can vary greatly, each shipper needs to purchase coverage for his own goods. I’ll give an example here, of five different shipments of the same size:

• Mr. Jones 1 x 20 of used Household Goods – $18,000
• Dynaflex Industries 1 x 20 of high-tech Gadgets – $500,000
• Museum of Art 1 x 20 of Original Paintings – $250,000
• US Army 1 x 20 – top secret – ?????
• Mr. Smith 1 x 20 new and used household goods – $70,000

Hopefully this will give you an idea of why it is fair for each shipper to pay for his own coverage, and why it is the only practical way to do it.

Keep in mind, that this means insurance must be considered as part of the cost of the shipment, and is usually not optional!

While the terms of every Marine Insurance Company vary, (and have to be read!) there are some similarities.

You can get either Total Loss or All Risk.

Total loss means that you can only make a claim if your cargo is considered a “total loss”. In simple words, this means you don’t get any of the cargo, but you get a check.

Note – Goods that are owner packed are almost always covered for total loss only.

All Risk means that you can make a claim if a dish breaks, or a piece of furniture gets damaged. Usually you are given a period of time from when the goods are delivered to go through everything and file what is missing or damaged. Regardless of how much or how many pieces are missing or damaged, you usually get only one claim.

Marine Insurance Companies generally require you to insure your goods for the full replacement value in the country of destination. This is often called the “Co-insurance clause”. It’s an odd name, but it’s important, particularly in the case of damage. If you underinsure a piece, and it needs to be repaired, the insurance company will pay out proportionately. Here is an example:

You have a dining room table which is worth $5,000. But you want to save some money, so you insure it for $2,000 (40% of its replacement value).

The table arrives damaged, and the repair will cost $1,000. The insurance company will pay that at 40% (meaning $400), based on the fact that you only insured it for 40% of what it is really worth.

Last but not least, is that you will need to supply a list of what you are shipping, and what it will cost to replace, as new, in the destination country. While all Marine Insurance Companies will have a different form to fill out, they will all want the same information, so get started on the list early.

This is also where the group of people you met online (or from some other medium) in the destination country can help – they can tell you the cost or availability of items you want to ship. It might be that the hard wood dining room table is twice the price, or isn’t even available there.

Always add the cost of shipping to the value of insurance.

 

Full Pack versus Partial Pack versus Self-Load

One of the ways to reduce the cost is to reduce the services you require. This will often not make a big difference in cost, yet it will make a big difference in the chances of damage, and your ability to file a claim against damages. This might also increase your chances of a customs inspection (as well as the extra, not included, charges).

In a full pack move, the international shipping company will pack all of your goods – boxes, clothing, dishes, as well as wrap your furniture. It is important to check that this service includes materials. If not, expect very high charges for materials! With this type of service, you can almost always get All Risk Coverage.

Sometimes it makes sense to do a partial-pack. This means that you pack non-breakable items (like books and clothing) and the shipping company packs breakable items (like dishes) and wraps furniture. Items which you pack will have limited coverage (usually only if the box is lost, and only if you provide a list before pick-up of what is in each box, and what the box is worth). Check to see if the International Shipping Company will supply materials for goods that you plan on packing, and if not, consider the cost of proper packing materials and boxes.

The least expensive option is to load the container yourself. The reason for this should be obvious – you will be doing all of the hard work, supplying all of the materials, and taking all of the risk of damage. Unless you have experience as a professional international packer, this is not a good option. Consider shipping fewer goods to save money instead.

Note – The more goods that are packed by the shipper (you), the greater chance there is of a customs inspection, and extra charges.

 

The Problem with Quotes “To Port”

Many International Shipping Companies will try to sell you services “to port” only. This will be much less expensive than door to door, because it is not inclusive of all of the fees you will need to pay (even if you plan on hiring a truck to pick the goods up!).

A quote “To Port” will never include any of the Destination Port Fees or Terminal Handling Charges, which will be due! Also, many ship lines and/or container lines will not release a container to an individual without a large deposit. Lastly, ports often give a very limited amount of time to clear the container from customs and remove the container before costly charges start.

In short, if you do not already do regular shipments to the destination country, if you don’t employ a licensed customs clearer, and if you don’t already have any agreements with the foreign port, bonded warehouses, and ship lines, do NOT take this option.

If you want to save some money by not having delivery service, ask for a quote “To warehouse, customs cleared”.

 

Not Included

This is the single most important section of any international shipping quote to read, and understand. This is where the “hidden fees” will be, as well as the legitimate, unpredictable costs will be explained.

Here are some standard not included items, and an explanation of what they are:

• Custom and Duties
  

Even used household goods may be subject to import duties. It is important to find out what the exemptions are for the destination country, what you will need to do to get those exemptions, and what the duties (customs) will be for items that are not exempt.

• Difficult Access/Egress or Impractical Operation
  

Since the International Shipping Company usually does not know where you will be moving, they will offer a price making some assumptions. These assumptions include that there will be room on the street for a relatively large truck, that the truck can park relatively close to the door of the house or apartment, and that they won’t have to carry the goods up more than one or two flights of steps.

If you don’t know where you will be moving, find out what these extra costs might be, so you can keep that in mind when looking for a place to live (and accept delivery).

• Custom Crating
  

The surveyor will determine if you have something that needs special packaging or custom crating, however if there is nothing in the house that requires this at the time of the survey, it will not be included (keep this in mind if you are debating buying a large Flat Screen TV or an expensive piece of artwork.)

• Unusually Heavy or Bulky Items
  

Items like safes or pianos require extra labor and/or special equipment. If the surveyor sees a piano when he surveys, the associated costs should be listed, however if not, assume that there will be extra charges.

• Customs Inspection or Quarantine Charges
  

In the event that Customs wants to check what is in the shipment (either on export from the origin country or import into the destination country), there will be extra charges, and they will not be included. The shipper (you) will need to pay these charges.

• Force Majeur
  

This is a legal term, and it basically means “Anything that can’t be predicted or controlled”. Some examples would be a war, strike, or natural disaster. The shipper (you) will need to pay these charges.

Now, here are some items which may be in the “Not Included” section which should be included:

Note – If one of the items below is listed as “Not Included” on your price quote – find out, in writing, what it will cost as part of your actual shipping expense

• THC, Destination Port Fees, or DTHC
  

This basically means the fees that will be charged by the destination port, the destination ship line offices, and the destination bonded warehouse.

Because of differences in translation, it may show up as any of the above, but if it’s not listed, in writing, get it!

• Materials
  

It is very important to find out the cost of the materials, especially if you are getting full pack service. This is a simple way to hide a big fee.

• Customs Clearance
  

This is the procedure of turning over all of the paperwork and dealing with the foreign tax officials in the destination country. It’s usually relatively inexpensive, and it should be a standard part of door to door services.

• Delivery to door
  

It may seem odd that this would be listed as not included on a door to door quote, but it is an easy way for an unethical salesman to offer a seemingly lower price, especially to the customer who doesn’t read the quote.

 

Summary:

By now this is where you’re at:

• You’ve reviewed the three quotes you got, based on visual surveys.
• You’ve reviewed what is and what is not included.
• You’ve made sure that the quotes include what you will need to pay.
• You’ve budgeted some for what you might need to pay, just in case.
• You’ve calculated how much insurance you will need, and what it will cost.
• You’ve come up with three totals, inclusive of everything that can be predicted, inclusive of insurance, and inclusive of a little extra just in case.
• You’ve had a chance to get an idea of who your Move Manager is, what type of person they are, and how well you and they communicate.

Now you’re ready to make your choice. If you’ve gotten this far in the process, the choice will be pretty obvious.

Choose the International Shipping company that is able to provide the services you want and need, and the Move Manager that you will feel comfortable with over the next few weeks (or months) while your goods are in transit, until they arrive at your new home.

May you have a successful move!

 

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Ed Singer is an Import/Export expert at Sonigo International Shipping, where he assists customers worldwide to arrange problem-free international moves. 

Based in Israel, Sonigo is part of UTS Unigroup and is a FIDI/Faim registered company.  FIDI is the largest global alliance of independent quality international removal companies; FAIM is the only quality standard for the international moving industry.

 

Ed Singer
Sonigo Intl Shipping
Ashdod, Israel
Tel: 972 8 6111-222
Fax: 972 8 6111-223
Cell: 972 52-611-9674
Skype:Ed.Singer.Israel
Email: Ed Singer
US Toll Free: 1 (866) 978-5224 or (201) 535-4703
UK Free Phone: 0 800 097 5563