The rate con, clause by clause, and the three lines most brokers leave out

One missing line about who eats the claim. Here is the rate con read clause by clause, and the three lines most brokers leave off.

You send a rate con forty times a week and you have probably never read your own. Mine came off a template somebody posted in a Facebook group. I ran it for eight months before a cargo claim showed me the hole in it, and that hole cost me $4,200.

What it actually is

Your carrier packet has the broker-carrier agreement in it. That is the master contract. The carrier signed it once, filed it, and has not opened it since. The rate con is the work order for one load, and it is the only document the dispatcher and the driver actually read.

That matters when something goes wrong, because the argument you end up having is almost never about the master agreement. It is about the sheet with the money on it. Anything you want enforced on that load has to be on that sheet too, in plain language, above the signature line.

The lines that pay you

Carrier legal name and MC number, spelled the way it reads on the authority. Not the dba, not the name in the dispatcher's email signature. If you pay Smith Logistics LLC and the authority belongs to Smith Transport Inc, you just paid a company you never vetted.

The rate broken out instead of one lump. Linehaul $1,850, fuel surcharge included, total $1,850. A single number invites a phone call on Friday about whether fuel was supposed to be on top of it.

Detention with a trigger, a rate and a cap. Two hours free, $45 an hour after that, capped at $300, documented by in and out times on the bill. Leave the cap off and you will eventually get an invoice for eleven hours at a yard that closed at five.

TONU at a fixed number, $150 or $200, and say what it covers. It covers a truck that arrived and was turned away. It does not cover a truck that never dispatched.

No reassignment, no re-brokering, no interlining without written consent, and the truck that shows up carries the MC on this sheet. Ch. 6 was the whole story on that one.

The three most people leave out

The first is offset, which is the right to take money the carrier owes you out of money you owe the carrier.

Mine said nothing about it. In February a carrier tore the top layer of a load of packaged goods on a low dock and the consignee took $4,200 off my invoice. The carrier's insurer dragged, the dispatcher stopped answering, and I had already paid the load two weeks earlier because the paperwork came in clean and my system paid on clean paperwork. There was nothing left to hold. I ate the $4,200 and the shipper watched me eat it.

The fix is one sentence. Broker may set off and deduct from any amount due Carrier, on this load or any other load between the parties, any sum owed to Broker for cargo loss or damage, overcharges, fines, or claims asserted by the shipper. Then a second sentence. Broker may hold payment on a load with an open claim until the claim is resolved or Carrier's insurer confirms coverage in writing.

That second sentence is the one that saves you, because all of the leverage in a claim sits in the timing. Once you have paid, you are an unsecured creditor chasing a carrier with a $100,000 cargo policy and a phone that rings out. Before you pay, you are the one holding $1,850 of theirs, and the conversation goes differently.

The second missing line is the paperwork condition. Signed POD and all accessorial backup emailed within 48 hours of delivery, invoice not payable until received. Most rate cons ask for paperwork. Almost none of them make payment depend on it, which is why a carrier can sit on a POD for nine days and still expect you to pay on day 30. They are borrowing against your cash, not theirs, and your shipper is not extending you the same courtesy.

The third is accessorial pre-approval in writing. Lumper, layover, extra stop, reconsignment, none of it is owed unless you approved it by email or text before the driver did it. Pre-approval is the entire clause. A driver who pays a $175 lumper and sends you the receipt three days later is asking you to fund it out of your margin, and if your rate con is quiet on it you will probably pay, because arguing over $175 with a carrier you want to keep is a bad trade.

What they will push on

Good carriers will ask you to cap the hold, and that is fair. Agree to hold only up to the amount of the claim rather than the whole check. If the claim is $900 on a $2,400 load, pay the $1,500 now and say so in writing.

They will push on the 48 hour window. Give them 72 if it gets the truck loaded, but keep the condition itself. A carrier who cannot scan a POD in three days is not going to scan it in thirty.

They will not push on no re-brokering, because a real carrier already runs that way. If a dispatcher argues about that clause, you just learned something for free and you should pass on the load.

The one to expect a real fight on is offset reaching across other loads. A carrier running four loads a week for you does not love the idea that a claim on Tuesday can touch Friday's check. Hold the line anyway. The carriers who disappear on a claim are exactly the ones who want it limited to the load that got damaged.

This week

Open your own rate con and read it like a carrier's attorney sent it to you. Search it for the word offset. Most templates going around do not have it anywhere.

Add the offset sentence, the claim hold sentence and the payment condition above the signature line, then send the next one to a carrier you already run with every week and watch whether anybody says a word about it. Eleven loads later nobody had said anything to me.

Pull the last three loads you paid where something went sideways, a short count, a late delivery, a lumper you never approved, and add up what you paid out that you did not have to. That number is what these three lines are worth to you per quarter, and it is usually bigger than the margin on the load that caused it.

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Next Tuesday, Ch. 10: carrier red flags, the ones that are normal on their own and the pairs that mean you stop and pick up the phone before the truck moves.

The Shipper Playbook