Notice of Loss

Notice of Loss is a key term in international trade and insurance practice, referring to a formal written notice issued by the insured or consignee to the insurance company, carrier, or relevant responsible party after discovering loss, damage, or shortage of goods. Its core functions are: first, to initiate the insurance claim procedure; most insurance clauses require the insured to give notice immediately or within a reasonable period (e.g., 30 days) after becoming aware of the loss, otherwise the right to claim may be affected; second, to preserve evidence; the notice usually must state the nature, extent, time, place, and preliminary cause of the loss; third, to assert rights against the carrier; under maritime law or international conventions, the consignee should give written notice of cargo damage within a specified period after taking delivery (e.g., 3 days), otherwise the goods are deemed delivered in good condition. Use scenarios include: discovery of cargo damage after the buyer takes delivery under CIF/FOB contracts, insurance claims, recourse against carrier liability, etc. Precautions: the notice should be in writing and proof of delivery should be retained; the content should be specific and avoid generalities; note the differences in notice deadlines for different responsible parties (insurer, carrier, port); unlike a claim notice, a notice of loss focuses more on informing of facts and does not necessarily include a specific claim amount. The difference from a cargo damage survey report is that the latter is a certification document issued by a third-party inspection agency, while a notice of loss is a preliminary statement issued by the party itself.