Canadian Accredited Insurance Broker (CAIB) Two Practice Exam

What option allows an owner to reduce transportation costs for insured goods?

1. Utilizing a standard Bill of Lading

2. Choosing a higher value for the goods

3. Opting for a Released Bill of Lading

4. Ignoring the insurance requirements

The correct answer is: Opting for a Released Bill of Lading

Opting for a Released Bill of Lading permits an owner to reduce transportation costs for insured goods. A Released Bill of Lading indicates that the shipper is agreeing to limit the liability of the carrier for any loss or damage to the goods. By doing this, the owner accepts a lower cost of freight in exchange for a reduced level of liability coverage. Choosing a higher value for the goods, on the other hand, would typically increase the premium for insurance, thus raising overall transportation costs. Utilizing a standard Bill of Lading does not specifically address cost reduction; it is simply a widely used document for the transportation of goods. Ignoring the insurance requirements could lead to significant financial risk in the event of loss or damage, rather than a method of cost reduction.