Intermediaries: Protecting Your Interests 05/02/2016

Contracting General Contracting -Key is to define each party correctly – brokers not carriers -Know who you are doing business with and set the business rules in writing -Define things like double brokering and payment responsibility Understanding Insurance Liability -Know government requirements for general, auto, and cargo liability -Ensure cargo liability matches your needs -Cargo liability should be defined in terms of “maximum” -Indemnification do’s and don’ts Liability for Freight Charges -Contract to protect yourself from duplicate payment -Clarify for both parties who is paying whom -What does the broker’s contract with the carrier look like? The key is to ensure that both parties know what to expect from the other.

Carrier Selection / Mgmt. Carrier Selection Best Practices -Licensed, Authorized, Insured -EIN Validation -Insurance documents – validate and then validate again! -Contract! -Miles driven, trucks, know your carriers! Ongoing carrier management -FMCSA monitoring -Active Insurance monitoring -MC Authority Updates Fraud protection -Cargo Net, FreightWatch etc. partnership -Double and Triple Check phone numbers -No exceptions!! -Money Code Fraud Prevention Program

Negligent Selection / Vicarious Liability Negligent Selection -Have a carrier selection process and DO NOT DEVIATE -Standardize the program, and do not allow exceptions -IF there has to be an exception, have it documented Operational Aspects -Use of “Dispatch” -Force Dispatch -Unreasonable Transit Times -Consequential Damages Carrier Rate Confirmations -Understand what language can / cannot be used -Be careful what you line item -Understand how what you pay affects this -Rate reductions related to service

Double Brokering Know the Risks -Companies are not always going to be up front -Double brokering is going to happen -Watch carriers for signs of double brokering activity Key Watch Outs -Zero miles driven -Operating authority issues / transfers -No driver contact -Sudden growths in “truck fleet” Partnership Mentality -Be prepared to protect the customer -Be willing to cutoff the “carrier” -Work hard to understand who you do business with -Try to reduce last minute carrier additions

Thank You