November 2006| Issue 46


In This
Issue:

>The Need for Regulatory Defense:
Combined Transit Liability (CTL) Program

>Port Security Bill Passes

>NCBFAA Government Affairs Conference

>Truck Claims and Loss Prevention:
LGIC Seminar Highlights

>International Truck Show:
Highlights and Truck Insurance

>CBP Update:
Enhanced Bonding Requirements

>Increasing Premiums for E&S Lines

>Claims Corner:
CTL Program

Events Calendar:

November 11 - 14
Transcomp
Ft. Lauderdale, FL

December 13 - 15
Trade Symposium
Washington, DC

 

Port Security Bill Passes

Congress passed the Security and Accountability for Every (SAFE) Port Act of 2006, H.R. 4954, the first legislation of its kind to authorize an annual federal funding level to help secure United States ports against terrorism.

Initially, members of Congress argued for 100 percent examination requirements for ocean containers and air cargo, but when the National Custom Brokers and Forwarders Association of America (NCBFAA) members attended their Government Affairs Conference in September, they ensured that Congress was aware that 100 percent examination would completely halt trade.

Highlights of the bill include:

All containers entering the 22 largest ports (by volume) will, by the end of 2007, be “scanned” by using non-intrusive imaging equipment for radiation. (Sec. 121(a))

Within one year, the Department of Homeland Security (DHS) will conduct random inspections of containers, in addition to those otherwise specifically identified for inspection. (Sec.123)

A major concern for the trade community has been requiring a plan for post-incident resumption of trade. The bill specifies that preference for resumed processing be given to cargo originating in Container Security Initiative (CSI) ports, as well as Customs Trade Partnership Against Terrorism (C-TPAT) participants, scanned cargo, and screened cargo. (Sec. 202)

In improving the Automated Targeting System (ATS), DHS will require the submission of “additional non-manifest data,” 24 hours prior to lading overseas. (Sec. 203)

C-TPAT is recognized as a formal CBP program, but remains voluntary and non-regulatory. Brokers, carriers and forwarders are specified as participants. Tier I may include the incentive that the ATS score would be reduced (subject to a percentage cap); Tier II benefits may include reduced scores, reduced examinations, priority searches and expedited release during all threat levels. The bill also calls for an increase in at least 50 people to serve as full-time C-TPAT personnel. (Sec. 211-223)

A 100 percent scanning program test will be established at three foreign seaports, with a follow-up report by DHS to Congress with analysis and recommendations. (Sec. 231)

The bill provides for 100 percent screening (i.e., review of data) and 100 percent scanning of foreign containers identified by the screening as high risk. (Sec. 232)

CBP is statutorily reorganized, providing for an Office of International Trade, transferring the assets of the Office of Strategic Trade and the Office of Regulations and Rulings. Some constraints are placed on moving personnel associated with textiles and apparel. (Sec. 402)


Avalon ensures that its clients are aware of key issues in international trade and recognizes the importance in protecting your cargo.

Avalon works with multiple markets to provide coverage tailored to meet specialized cargo insurance needs. All policies provide basic All-Risk coverage for cargo in transit, including Free of Particular Average and With Average alternatives. At Avalon, we go beyond standard coverage forms to offer customized cargo policies which can include:

  • Project Shipments

  • Break Bulk & Bulk Cargo

  • Warehouse Storage

  • Cargo Legal Liability

  • Special Cargo Clauses
     

Avalon accepts electronic reporting transmissions from your computer system or through our proprietary Internet-based system, Marine Merlin™. With Marine Merlin™, the user can view policy and rate information, automatically calculate premiums, print an insurance certificate, view invoices, request special quotes via e-mail, store special quotes for the future and search for previous transactions. Marine Merlin™ allows the user to manage their cargo insurance program and save time.

To find out more, select our Cargo brochure or application for a cargo quotation.

For further information, please contact your local Avalon office or Andriana Davis, Product Manager at Avalon’s corporate headquarters. Andriana Davis can be reached at her direct line: 847-700-8087 or via e-mail at adavis@avalonrisk.com. To view a directory of Avalon’s office locations, please visit our Web site at www.avalonrisk.com.

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The Quest newsletter is published once a month and is designed to provide critical information to the transportation and logistics industry. Subscribers to The Quest also benefit by receiving policy change notifications, special industry information bulletins, and notifications of upcoming conferences. Avalon Risk Management, Inc. is not responsible for the accuracy or reliability of information contained herein. The reader/user assumes all risk in the use of such information. To subscribe to or unsubscribe from The Quest, please visit the Quest Newsletter page on our Web site. To view prior issues of The Quest visit the Quest Archives.

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