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Attention, Summer Movers: Full Replacement Value Is Here!
By Jessica Perdew
Summer 2008
Moving is a familiar but stressful reality of military life. To improve the quality for those who move and streamline the process for those who support it, the Department of Defense (DoD) developed its new “Families First” program. The linchpin of the initiative is the provision for full replacement value (FRV) coverage for military personal property shipments.
The 2007 National Defense Authorization Act mandated full replacement value coverage by March 2008. In some instances, DoD met this mandate well ahead of schedule. FRV coverage for shipments to and from overseas locations began Oct. 1, 2007. Domestic shipments were covered beginning Nov. 1, and non-temporary storage and local moves were included effective March 1, 2008.
Shipments of household goods are now insured for the greater of $5,000 per shipment or four dollars times the weight of the shipment (in pounds) up to a maximum of $50,000. Servicemembers desiring coverage above these limits may be able to obtain additional coverage through their homeowners or renters policy.
These changes in coverage are accompanied by some significant changes in the claims process. Damage visible at the time of delivery must be reported to the transportation service provider (moving company) on DD Form 1840 at the time of delivery. Damage not noted at delivery must be reported to the moving company on DD Form 1840R within 75 days of shipment delivery. Claims will now be made directly to the company and must be filed on DD Form 1844 within nine months of delivery.
Servicemembers will be informed where to send claims during the pre-move counseling appointment. In the event the company does not provide a local representative and servicemembers must mail claims, it is best to use certified mail with return receipt service as proof that the documents were sent and received in a timely manner.
One important caveat to the claims process involves household goods coming out of non-temporary storage. Because these shipments entered storage under the old depreciated value system, it is important to clarify the date of damage to the items. Damage inflicted prior to removal from non-temporary storage will be adjudicated under the old system at depreciated value.
Damage resulting from the removal and transportation of the shipment to the new duty station, when pickup occurred on or after March 1, 2008, will be covered under the current FRV policy. Damage present at the time the carrier obtains the shipment for delivery will be noted on the warehouse documents at the time of pickup. If no damage is noted, all damage to the shipment is considered the result of transportation to the new duty station.
The mover has the right to inspect damaged property when notified of damage. Claims will be settled by repairing or paying for the repair of damaged items. The company also will pay FRV for items that are missing or destroyed. Servicemembers will no longer be required to obtain repair estimates on broken items; the moving company is responsible for obtaining all repair and replacement estimates.
Surface Deployment and Distribution Command (SDDC), the agency responsible for oversight of the household goods shipment process, indicates that movers have representatives or agents available to make inspections in all geographic locations, including overseas duty stations.
If the company denies the claim, makes an unreasonable offer or fails to respond within 30 days, the customer may transfer the claim to the Military Claims Office. This office generally is affiliated with the installation legal office, but servicemembers must inquire at their local installations for the exact location.
It is important to note that claims settled through the Military Claims Office will be paid at the depreciated replacement cost level currently in use. If the claim is transferred to the Military Claims Office within nine months of delivery, the office will attempt to collect FRV from the mover. If the Military Claims Office is successful, the customer will receive the FRV amount less any previous payments. Any claims submitted more than nine months after delivery but before the two-year time limit will be paid at the depreciated replacement cost level.
One of the most critical aspects of the “Families First” program is the customer satisfaction survey. Customers will receive a survey for each shipment, and the responses will be used to help ensure that companies with the highest satisfaction ratings receive the greatest number of shipping contracts. So customers should take the time to accurately and honestly complete these surveys and return them in a timely manner.
For more information on the implementation of full replacement value, go to www.sddc.army.mil/Public/Personal%20Property and click “Full Replacement Value Protection.” Because implementation of FRV coverage has significantly altered the claims process, make sure you are thoroughly briefed on your rights and responsibilities under this new program.
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Jessica Perdew is a deputy director of government relations for the National Military Family Association (www.nmfa.org).
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Families First: Key Improvements
- Shipments awarded based on quality of service, “best value” carrier selection
- Full replacement value on loss and damage claims
- Electronic rate filing for transportation service providers; allowance for seasonal rates
- Increased direct deliveries
Source: Surface Deployment and Distribution Command (SDDC)