All moving companies are required to assume liability for the value of the goods which they transport. However, there are different levels of liability, and consumers should be aware of the amount of protection provided and the charges for each option.

Basically, most movers offer four different levels of liability under the terms of their tariffs and pursuant to the Released Rates Orders which govern the moving industry.

Released Value

This is the most economical protection option available. This no additional-cost option provides minimal protection. Under this option, the mover assumes liability for no more than 60 cents per pound ($1.32 per kilogram), per article. Loss or damage claims are settled based on the pound weight of the article multiplied by 60 cents (or the kilogram weight multiplied by $1.32). For example, if a 10-pound (4.54 kilogram) stereo component, valued at $1,000 were lost or destroyed, the mover would be liable for no more than $6.00. Obviously, the shipper 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.

Declared Value

Under this option, the valuation of your shipment is based on the total weight of the shipment times $1.25 per pound ($2.75 per kilogram). Any loss or damage claim under this option is settled based on the depreciated value of the lost or damaged item(s) up to the maximum liability value based on the weight of the entire shipment.

Unless specifically agreed to other arrangements, the mover is required to assume liability for the entire shipment based on this option. Also, the mover is entitled to charge $7.00 for each $1,000 (or fraction thereof) of liability assumed for shipments transported under this option. Under this option, shipment is protected based on its depreciated value, and the mover is entitled to charge fee for this extra protection.

Lump Sum Value

Under this option, if the value of shipment exceeds $1.25 per pound ($2.75 per kilogram) times the weight of the shipment, shipper may obtain additional liability protection from the mover. This is done by declaring a specific dollar value for shipment. The amount declared must exceed $1.25 per pound ($2.75 per kilogram) times the weight of the shipment. The amount of value that declared is subject to the same valuation charge ($7.00 per $1,000) as described in last section. Shipper must make this declaration in writing on the bill of lading.

Full Value Protection

Many movers offer a fourth level of added-value protection, often referred to as "full value protection" or "full replacement value." If shipper elects to purchase full value protection, articles that are lost, damaged or destroyed will be either repaired, replaced with like items, or a cash settlement will be made for the current market replacement value regardless of the age of the lost or damaged item. Unlike the other options, depreciation of the lost or damaged item is not a factor in determining replacement value when the shipment is moved under full value protection.

The cost for full value protection is approximately $8.50 per $1,000 of declared value; however, the minimum value declared must be equal to the weight of the shipment multiplied by $3.50 per pound ($7.70 per kilogram), which is further subject to a minimum declaration of $21,000.

Under these four options, movers are permitted to limit their liability for loss or damage to articles of extraordinary value, unless shippers specifically list these articles on the shipping documents. An article of extraordinary value is any item whose value exceeds $100 per pound ($220 per kilogram).

These optional levels of liability are not insurance agreements which are governed by State insurance laws, but instead are authorized under Released Rates Orders of the U.S. Department of Transportation. In addition to these options, some carriers may also offer to sell, or procure, separate liability insurance from a third-party insurance company. This is not valuation coverage governed by Federal law, but optional insurance that is regulated under State law. If purchased, 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 ($1.32 per kilogram) per article, and the balance of the loss is recoverable from the insurance company up to the amount of insurance purchased. If liability insurance purchased from or through your mover, the mover is required to issue a policy or other written record of the purchase and to provide a copy of the policy or other document at the time of purchase. If the mover fails to comply with this requirement, the mover becomes fully liable for any claim for loss or damage attributed to its negligence.