Inside Business Controls » Lost and Found

Lost and Found

Posted August 13, 2008 by Gene Ferraro

U.S. airlines carried an estimated 660 million passengers last year and only .005% of all checked baggage was permanently lost. Yet mishandled baggage, the term used by the airline industry for missing or delayed baggage, continues to frustrate thousands of travelers every day.

Reporting your lost luggage

Your luggage is the responsibility of the airline that flew you to your destination. Always report your missing items to the airline before leaving the airport and present your luggage receipt as proof of what you checked in. Asking to fill out a Property Irregularity Report (PIR) is also advisable as it will help with any future compensation claim that may be necessary.

Limits on liability

Under the terms of the Montreal Convention of 1999, compensation for lost or damaged luggage on an international flight is limited to a maximum of roughly $1,500—a figure that fluctuates because it is tied to the exchange rate of the dollar against various other currencies. For domestic flights, compensation is a maximum of $3,000 (Information about lost and damaged baggage is available at airconsumer.ost.dot.gov/publications/flyrights.htm.) When your luggage and its contents are worth more than the liability limit, you may want to purchase “excess valuation,” if available, from the airline with which you are traveling. This is not insurance, but it will increase the carrier’s potential liability. The airline may refuse to sell excess valuation on some items that are especially valuable or breakable, such as antiques, musical instruments, jewelry, manuscripts, negotiable securities and cash.

Keep in mind that the liability limits are maximums. If the depreciated value of your property is worth less than the liability limit, this lower amount is what you will be offered. If the airline’s settlement doesn’t fully reimburse your loss, check your homeowner’s or renter’s insurance; it sometimes covers losses away from the residence. Some credit card companies and travel agencies offer optional or even automatic supplemental baggage coverage.

Things the Airlines usually Refuse to Cover

Different airlines may have slightly different lists, but in general, they will usually refuse liability for the loss, delay, or damage to the following: