Household Goods:

Evaluation of Department of Defense Claims Payment and Recovery Activities

NSIAD-89-67: Published: Feb 24, 1989. Publicly Released: Mar 8, 1989.

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In response to a congressional request, GAO reviewed the Department of Defense's (DOD) and the military services' procedures for resolving claims for damaged or lost household goods, focusing on whether DOD claims: (1) payments to service members were excessive; and (2) settlement was effective and efficient.

GAO reviewed claims payments data at 11 military installations, and found that: (1) the payments were reasonable and in accordance with claims regulations and procedures; (2) although the average military claims settlement value was higher than for commercial shipments, it was not an indication that military payments were overly generous; (3) temporary storage of military shipments prior to delivery and the potential for loss or damages accounted for the differences in the average settlements; (4) although claims payments were usually reasonable and timely, the services encountered difficulties in recovering claims from liable carriers; (5) 4 of the 11 installations that GAO reviewed had carrier claims backlogs, but the Air Force had successfully recovered a higher percentage of funds from carriers; and (6) the statutory 2-year filing period for household goods claims and DOD failure to use claims data to measure carrier performance contributed to claims management and adjudication problems.

Matter for Congressional Consideration

  1. Status: Closed - Implemented

    Comments: Congressional action on this issue has been postponed indefinitely for political reasons.

    Matter: Congress should amend the statutory periods for household goods claims to limit the time allowable for filing claims to 1 year after the claim accrues.

Recommendation for Executive Action

  1. Status: Closed - Implemented

    Comments: DOD instructed service Judge Advocates General, by letter dated May 16, 1989, to place more emphasis on recovery efforts by processing household goods claims and making assertions against carriers within 30 days of claims submission. Impact on amounts collected will not be determinable until at least June 1991.

    Recommendation: The Secretary of Defense should direct the Secretaries of the Army, the Air Force, and the Navy to place greater emphasis on recovery efforts associated with household goods claims.

    Agency Affected: Department of Defense

 

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