What should we put in our carrier agreement?
Key Takeaways
- A carrier agreement sets the rules for every load; a rate confirmation sets the price and details for one load. You need both, and they should not contradict each other.
- Most agreements cover the same core sections: scope, rates and accessorials, insurance, liability and claims, payment terms, no double brokering, confidentiality and termination.
- The most expensive gaps are usually in liability, claims and accessorials, because that's where disputes happen after something goes wrong.
- Start from a template your legal counsel has reviewed, and have counsel review any changes a carrier asks for. This article explains what the sections usually do; it is not legal advice.
- An agreement only helps if people use it: store it where the team can find it, check rate confirmations against it and review it when your freight or the carrier changes.
- Wilson, by Cartage, is an AI logistics agent that books only a company's approved carriers, collects a rate confirmation for every load and audits each invoice against it and the POD.
What should a carrier agreement include?
A plastics manufacturer has worked with the same regional truckload carrier for six years. Everything runs on rate confirmations and a handshake. Then a load of resin is damaged in a rollover. The carrier's insurer offers a settlement far below the value of the goods, citing a liability limit in the carrier's published terms that nobody at the manufacturer had read. The logistics manager looks for a signed agreement that says otherwise. There isn't one.
A carrier agreement should cover, at a minimum, the scope of services, how rates and accessorials are set, the carrier's insurance, liability for loss and damage and how claims work, payment terms, a ban on double brokering, confidentiality and how either side can end the relationship. Most agreements also cover compliance with laws, independent contractor status, indemnification, dispute resolution and how the agreement relates to rate confirmations and tariffs.
The exact wording matters, and it varies by company, mode and state. This article explains what each section usually does and why shippers include it, so you know what to ask for. Before you sign anything, or ask a carrier to sign anything, talk to your legal counsel.
Agreement, rate confirmation and tariff: how they fit together
Three documents govern most loads:
| Document | What it covers | How long it applies | Who writes it |
|---|---|---|---|
| Carrier agreement | The general terms for every load: liability, insurance, payment, conduct, termination | Until it's ended or replaced | Usually the shipper, reviewed by both sides |
| Rate confirmation | The price and details for one load: lanes, dates, equipment, accessorials agreed | One load | Usually the carrier or the party booking |
| Carrier tariff or rules | The carrier's published terms, accessorial charges and liability limits | Applies where the agreement doesn't override it | The carrier |
The agreement should say which document wins when they conflict. Without that, a carrier's tariff or the fine print on a rate confirmation may end up controlling terms you thought were settled. Many shippers' agreements state that the agreement controls unless a rate confirmation signed by both sides says otherwise for that load.
Why it matters even with long relationships
Carriers you've used for years still change owners, insurers, dispatchers and policies. A signed agreement keeps the terms stable when the people change. It also protects the carrier: clear payment terms and clear rules for accessorials mean fewer disputes for them too.
Carriers vs brokers
Agreements with carriers and agreements with freight brokers are different documents. A carrier moves the freight with its own trucks and drivers. A broker arranges for a carrier to move it. If you use both, ask legal counsel whether you need separate templates, because liability, insurance and payment work differently in each relationship.
What do the main sections of a carrier agreement cover?
Each section answers a question that will otherwise be argued about after something goes wrong. Here are the common sections and what shippers usually look for in each.
Scope of services
The scope says what the carrier will do: modes (truckload, LTL, drayage), equipment types, regions or lanes, and any special services such as hazmat, temperature control or team drivers. It often says that the agreement doesn't guarantee any volume, unless you choose to commit volume in exchange for rates. It should also say how loads are tendered and accepted, such as by email, EDI, API or phone, and that a load is only booked once the carrier accepts in writing.
Rates and accessorials
This section explains how rates are set: by rate sheet, by rate confirmation per load, or by reference to a tariff with a discount. It should cover:
- Base rates and where they're recorded.
- Fuel surcharge: the table used and how often it updates.
- Accessorials: which ones are allowed, at what price, and what proof is required (for example, detention requires arrival and departure times).
- Rate changes: how much notice the carrier must give before changing rates, and whether rates are fixed for a term. For how to respond when they change, see what to do when a carrier raises rates.
- No unapproved charges: charges not on the rate confirmation or the agreed schedule require approval before they're billed.
Most invoice disputes trace back to vague accessorial terms. A clear schedule with proof requirements prevents many of them.
Volume commitments and rate terms
If you agree to give a carrier a certain volume in exchange for better rates, put both sides of the deal in writing: the expected loads per week or month on each lane, the rates that apply and how long they're fixed. Say what happens if volume falls short or the carrier declines too many tenders. Many shippers prefer to describe volume as an estimate rather than a guarantee, so a drop in orders doesn't become a breach. Your legal counsel can advise on how firm the commitment should be.
Insurance
The insurance section lists the coverage the carrier must carry, such as auto liability, cargo insurance and general liability, and often workers' compensation. It usually requires the carrier to name the shipper as a certificate holder, provide certificates before the first load and notify the shipper if coverage is cancelled or changed. Ask your legal counsel and your insurance advisor what amounts fit your freight. Higher-value freight may need more cargo coverage than a carrier carries by default. Checking insurance is part of approving a new carrier; for the full set of checks, see how to check a new carrier before first use.
Liability and claims
This is often the most important section. It covers:
- Liability for loss, damage and delay: whether the carrier is liable for the full value of the goods, or up to a stated limit per pound, per load or per shipment.
- How value is measured: for example, the invoice price, replacement cost or another basis.
- Claim filing: where to send claims, what documents are needed and how quickly the carrier must respond.
- Deadlines: time limits for filing claims and lawsuits.
- Exclusions: what the carrier isn't liable for.
Federal law sets a baseline for interstate carriers. Under 49 U.S.C. 14706, a carrier can't set a deadline for filing a claim shorter than nine months, or for filing a lawsuit shorter than two years from a written denial. Liability limits and the interaction between the agreement and the carrier's tariff are areas where legal counsel's review matters most. For the claims process itself, see how to file a freight damage claim.
Payment terms
The payment section sets how and when carriers get paid:
- Invoice requirements: what each invoice must include (load reference, PRO number, rate confirmation, POD).
- Payment timing: the number of days after a complete invoice and POD.
- Quick pay: whether faster payment is available and on what terms.
- Disputes: how disputed charges are raised and resolved, and whether undisputed amounts are paid on time.
- Factoring and assignment: how the shipper is notified if the carrier assigns its invoices, and that payment instructions only change after verification.
- Invoice deadline: how long the carrier has to send an invoice after delivery.
For how factoring and quick-pay requests work in practice, see what to do when carriers ask for quick pay.
No double brokering
Double brokering is when a carrier accepts your load and then hands it to another carrier without your permission. You end up with freight on a truck you never approved, from a company you never checked, and sometimes with two parties asking to be paid. The agreement should say that the carrier must move loads with its own equipment and drivers, or drivers under its control, and may not re-broker, assign or subcontract a load without the shipper's written consent. It should also say what happens if it does, such as non-payment for that load, liability for any loss and the right to end the agreement.
Confidentiality
Carriers see your customers, lanes, volumes and rates. A confidentiality section limits how they can use that information, prohibits sharing it with others and often says they won't contact your customers directly to solicit business. It may also cover data security if the carrier connects to your systems.
Termination
This section says how either side can end the agreement: with written notice after a set period, or immediately for serious breaches such as loss of operating authority, lapsed insurance, double brokering or safety failures. It should also say what happens to loads in transit and invoices outstanding when the agreement ends. That matters most when a carrier fails suddenly.
Service expectations
Some shippers include service expectations: on-time pickup and delivery, how quickly the carrier confirms tenders, how soon it reports a delay and how it handles appointments. Others keep these in a separate routing guide or service document so they can update them without amending the agreement. Either way, write down what you expect and what happens when it isn't met, such as a review meeting or a reduced share of freight. Avoid promising remedies you won't actually use.
Communication, tracking and documents
Modern freight runs on messages and data. The agreement, or an attachment to it, can say how the carrier will share tracking updates (for example by API, EDI, its website or email), how quickly it reports exceptions such as missed pickups or delays, and how fast it sends PODs and delivery receipts after delivery. It can also say who the contacts are on each side and how formal notices are sent. Clear expectations here cut down the follow-up calls that eat a logistics team's day.
Other common sections
| Section | What it usually covers |
|---|---|
| Compliance with laws | Carrier keeps its operating authority, follows safety and hours-of-service rules, and handles hazmat properly |
| Independent contractor | Carrier controls its drivers and equipment; drivers aren't the shipper's employees |
| Indemnification | Who covers which costs if a third party makes a claim after an accident or loss |
| Documents | BOLs, PODs, delivery receipts, and how quickly they must be provided |
| Order of precedence | Which document controls when the agreement, rate confirmation and tariff conflict |
| Dispute resolution | How disagreements are handled: negotiation, mediation, arbitration or court, and which state's law applies |
| Notices | Where and how formal notices are sent |
| Entire agreement and amendments | That changes must be in writing and signed |
How do you put a carrier agreement in place?
Start from a template your legal counsel approves, adjust it for the carrier and mode, sign before the first load and store it where everyone who books or pays freight can find it. The process matters as much as the wording.
Step 1: Build a template with legal counsel
Work with your legal counsel to create a standard carrier agreement for your company. Include the sections above and decide your positions in advance: liability limits you'll accept, insurance amounts, payment terms and termination notice. A template saves negotiating from scratch with each carrier and keeps terms consistent.
Step 2: Adjust for mode and freight
Truckload, LTL, drayage and parcel carriers work differently. LTL carriers often rely heavily on their published tariffs and rules. Parcel carriers usually work from their own service terms and negotiated pricing. Specialist freight, such as hazmat or high-value goods, may need specific clauses. Ask counsel whether you need separate templates or a single template with mode-specific attachments.
Step 3: Send it before the first load
Make the signed agreement part of approving a carrier, along with the insurance certificate and authority check. It's much easier to agree terms before the first load than after the first dispute.
Step 4: Handle requested changes
Carriers will sometimes ask to change terms, especially liability limits, payment timing and indemnification. Some changes are reasonable; some shift risk you don't want. Send requested changes to legal counsel and record what was agreed. Don't let changes happen through email replies that nobody files.
Step 5: Store it where people can find it
An agreement in a legal drawer doesn't help the person checking an invoice. Store the signed agreement, its rate sheet and any amendments with the carrier's record, where logistics and accounts payable can see the key terms: accessorial schedule, payment terms, liability limit and insurance expiry.
Step 6: Link it to every load
Every rate confirmation should be consistent with the agreement. When a rate confirmation shows charges or terms the agreement doesn't allow, flag it before booking. When an invoice includes charges outside the agreement, hold it. This is where the agreement turns from a document into a control. For the difference between per-load pricing and agreed rates, see spot quotes vs contract rates.
Step 7: Review it
Review agreements when your freight changes, when a carrier changes ownership or insurer, after a major claim and at least every few years. Laws, insurance markets and your own business change. A ten-year-old agreement may not fit how you ship today.
An example: one clause, two outcomes
Consider two hypothetical shippers, each with a load of electronics damaged in transit. The first has a signed agreement stating that the carrier is liable for the invoice value of lost or damaged goods, that the agreement overrides the carrier's tariff, and that claims must be answered within a stated period. The claim is filed with the BOL, POD, photos and invoice, and the carrier's insurer pays the invoice value. The second shipper relies on rate confirmations alone. The carrier's tariff limits liability per pound, so the payout is a fraction of the goods' value. The difference wasn't the damage. It was the agreement.
What mistakes should you avoid in a carrier agreement?
Most problems come from agreements that are missing, vague, unsigned, out of date or ignored. The decision rules are simple once the gaps are clear.
Common mistakes
Running on rate confirmations alone. Rate confirmations cover price and load details. Without an agreement, the carrier's tariff and the rate confirmation's fine print often fill the gaps, and those are written to protect the carrier.
Vague accessorial terms. "Reasonable accessorial charges apply" invites disputes. List the allowed charges, prices and proof required.
No order of precedence. If the agreement doesn't say which document wins, a carrier's tariff or rate confirmation terms may override what you negotiated.
Ignoring liability limits. Know the liability limit for each carrier, compare it with the value of your freight and buy additional coverage or negotiate higher limits where needed.
No double-brokering clause. Without one, a carrier may treat re-brokering as allowed.
Not tracking insurance expiry. Insurance certificates expire. A carrier with lapsed cargo coverage is a risk on every load.
Unsigned changes. Changes agreed by phone or email and never documented are hard to enforce.
Agreeing to anything a carrier sends. Some carriers send their own agreement. Read it with legal counsel before signing; it will favor the carrier.
Never reviewing it. Freight, laws and carriers change. Agreements should too.
Decision rules
| Situation | What to do |
|---|---|
| New carrier, no agreement yet | Sign your template before the first load |
| Carrier sends its own agreement | Compare it with your template; send to legal counsel |
| Carrier asks to change liability limits | Check freight value and insurance; send to legal counsel |
| High-value freight on a lane | Confirm cargo coverage and liability terms fit the value |
| Invoice includes a charge outside the agreement | Hold it and ask for proof or approval |
| Carrier changes ownership or insurer | Request new certificates; review the agreement |
| Agreement older than your current freight profile | Schedule a review with legal counsel |
A checklist for reviewing a carrier agreement
Use this checklist when you draft a template, review a carrier's proposed changes or audit your existing agreements. It's a list of questions to raise with your legal counsel, not a substitute for their review.
| Section | Question to ask | Done |
|---|---|---|
| Parties | Are the carrier's legal name and identifying numbers correct? | |
| Scope | Are modes, equipment, regions and special services listed? | |
| Tendering | Is a load booked only after written acceptance? | |
| Rates | Is it clear where rates are recorded and how they change? | |
| Rate changes | Is notice required before rate increases? | |
| Fuel | Is the fuel surcharge table named? | |
| Accessorials | Are allowed charges, prices and proof requirements listed? | |
| Insurance | Are coverage types and amounts stated, with certificates and notice of cancellation? | |
| Liability | Is the liability basis and limit clear, and does it fit your freight value? | |
| Claims | Are filing steps, documents and response times set out? | |
| Payment | Are invoice requirements, timing and dispute steps clear? | |
| Assignment | Must payment-instruction changes be verified? | |
| Double brokering | Is re-brokering without written consent prohibited, with consequences? | |
| Confidentiality | Are your customer, rate and lane data protected? | |
| Compliance | Must the carrier keep authority, safety and hazmat compliance? | |
| Termination | Are notice periods and immediate termination causes listed? | |
| Precedence | Does the agreement say which document controls? | |
| Signatures | Is it signed by authorized people on both sides? | |
| Storage | Can logistics and AP find the key terms? |
Keeping the key terms visible
The people who use the agreement most, logistics and accounts payable, rarely need the full document. A one-page summary per carrier with the accessorial schedule, payment terms, liability limit, insurance expiry and termination notice covers most daily questions. Update it when the agreement changes.
How does Wilson, by Cartage, work with your carrier agreements?
Wilson, by Cartage, is an AI logistics agent that quotes, books, tracks, audits and pays freight for manufacturers and distributors, applying the company's agreed rates and rules on every load. Traditional logistics software gives teams information. Wilson executes the work required to move shipments forward.
Wilson doesn't write or review agreements; that stays with the company and its legal counsel. What Wilson does is carry the agreed terms into the daily work:
- Approved carriers only: Wilson books only carriers the company has approved. Cartage can suggest additional carrier capacity, but the company approves each carrier before Wilson uses it. Wilson does not vet or score carriers by default.
- Written acceptance and rate confirmation: Wilson tenders and books with written acceptance and a rate confirmation for every load, so each load's price and terms are on record.
- Negotiation within limits: Wilson negotiates toward the company's rate targets within approval limits. Rates outside those limits go to the logistics team.
- Documents: Wilson generates rate confirmations, bills of lading, packing slips and pallet labels, and requests and files the POD for each load, which supports any claim.
- Invoice audit: Wilson audits each carrier invoice against the rate confirmation and the POD. Charges that don't match wait for a person, with the difference attached.
- Payment controls: Wilson pays carriers from the Wilson Wallet. Payments above the approval limits or outside the rules wait for a person.
Every message, confirmation and change is kept in the shipment's change history, so when a dispute arises, the record of what was agreed and what happened is on the load. Wilson replaces the TMS for freight execution and connects to the company's ERP. Wilson works with SAP, NetSuite, Microsoft Dynamics 365, Oracle, Infor, Epicor, Sage, Acumatica and other ERP environments, with the exact connection depending on the customer's data flow and scope.
Pricing
Wilson is free on Wilson's network: the shipper pays the freight rate and nothing on top. When a shipper keeps its own carriers, the fee is 2% to 0.5% of what Wilson pays them, falling with volume. There are no seat fees, no setup cost and no contract. Timing depends on scope: most teams start on a few lanes and expand from there.
FAQs
What should we put in our carrier agreement?
Most carrier agreements cover scope, rates and accessorials, insurance, liability and claims, payment terms, no double brokering, confidentiality and termination, plus order of precedence and compliance. Talk to your legal counsel about the wording. Wilson, by Cartage, an AI logistics agent, applies the agreed rates on each load and audits every invoice against the rate confirmation and POD.
Do we need a carrier agreement if we have rate confirmations?
Yes. A rate confirmation covers the price and details of one load. The agreement sets the general terms for every load, such as liability, insurance and payment, and says which document controls when they conflict.
What is double brokering?
Double brokering is when a carrier accepts a load and then hands it to another carrier without the shipper's permission. A carrier agreement usually prohibits it and sets consequences.
What insurance should a carrier agreement require?
Commonly auto liability, cargo and general liability, sometimes workers' compensation, with certificates and notice of cancellation. Ask your legal counsel and insurance advisor what amounts fit your freight.
How long do we have to file a freight claim?
Under 49 U.S.C. 14706, carriers can't set a claim filing deadline shorter than nine months or a lawsuit deadline shorter than two years from a written denial. Your agreement may set its own process within those rules.
Should we sign the carrier's agreement or use our own?
Many shippers use their own template so terms are consistent. If a carrier sends its own, compare it with yours and have legal counsel review it before signing.
What is an order of precedence clause?
It says which document controls when the agreement, a rate confirmation and the carrier's tariff conflict. Without it, terms you negotiated may be overridden by fine print.
Can a carrier agreement limit the carrier's liability?
Agreements often address liability limits, and carriers' tariffs may set their own. How limits apply depends on the wording and the law, so this is an area for your legal counsel.
How often should we review carrier agreements?
When your freight changes, when a carrier changes ownership or insurer, after a major claim and at least every few years.
Is this article legal advice?
No. It explains what carrier agreements commonly include. Talk to your legal counsel before drafting, signing or changing an agreement.
Sources
- 49 U.S.C. 14706, Liability of carriers under receipts and bills of lading: https://www.law.cornell.edu/uscode/text/49/14706
- Cartage, Wilson product FAQ and product scope, October 2026: https://cartage.ai