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Shipping Insurance


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Go To Great Panes, Kathryn Maloney ©2009-2012
(This post is copyrighted–you do not have permission to repost this content elsewhere but you are welcome to link to it if you’d like to share the information.)

First & foremost: Insurance protects the seller, not the buyer:

Stating that you aren’t responsible for lost packages in your policies is more than a turn off for buyers–it’s also usually not true. Whether the buyer paid through Paypal transfer or credit card, if you can’t prove your package arrived, Paypal will refund the buyer out of your account. If Paypal doesn’t refund them, your buyer can dispute the payment on through their credit card & that will cost you even more than refunding (see PP’s Fees section for “8.7 Additional Fees”.)

Not all packages need shipping insurance–I find that the vast majority of our shipped goods make it to their destination just fine. If you ship fragile, expensive or irreplaceable goods though, buying insurance might be a good idea. When to insure is a decision you need to make for yourself. Every business will have different price points at which purchasing insurance is the way to go–some insure everything over $50, some over $100…

If you insure a lot of packages, the fees can add up. If you ship internationally, you can’t even insure some of your through packages USPS and that is a problem for many sellers, but you can insure international First Class Mail! (details below)

It’s easy to add USPS insurance for most packages while you are paying for postage whether you are buying postage online or at the post office:

USPS insurance rates:
Domestic–available for all services
International–available for Priority & faster services only

When shipping internationally, the prices for Priority Mail International shipping is often cost-prohibitive–add insurance and the high prices might keep buyers from purchasing.

First Class International & the small flat rate Priority Mail International boxes are a more affordable shipping method but USPS doesn’t offer insurance for these services, which can be risky if you are sending items that are pricy/fragile/irreplaceable.

That’s a tough hurdle for lots of folks who want to sell internationally, until they learn you can purchase insurance through third-party shipping insurance companies.

Third-party Insurance

Not only is third-party insurance available for International First Class Mail, it less expensive than USPS’ insurance to boot–even for domestic shipping, less than $2 for $100 in coverage.

The two companies I’ve tried have different restrictions–one doesn’t cover jewelry, the other doesn’t cover stained glass. Since we sell both, I made a point of bookmarking each of them, including the pages where they list their rates and restrictions–each allow you to purchase insurance on a per package basis or to set up an account so all packages are covered for a monthly fee:

Shipsurance
http://www.shipsurance.com (formerly DSI insurance, same as InsurePost)
Coverage restrictions:
http://www.shipsurance.com/one_time_parcel_terms.asp?
Rates:
http://www.shipsurance.com/pop_order_online_shipping_insurance_rates.asp?

U-Pic
http://www.u-pic.com/index.aspx
Coverage restrictions:
http://www.u-pic.com/CoverageRules.aspx
Rates:
http://delta.u-pic.com/Order/OnlineRates.aspx

I haven’t needed to file a claim with either company, but purchasing the insurance through their websites was easy enough. I read about a few sellers who needed to file a claim with these companies–they said the claims process went well.

If you are selling on a venue, sometimes the venues have agreements for discounted third party insurance. On Etsy, the ShipSaver Insurance App offers third party insurance to sellers.

The rates for ebay sellers is better than the rates they give Etsy sellers when shipping USPS–what’s with that?


Destination
Shipped via USPS
Ebay Etsy
Domestic
per $100 in coverage
$0.79 $1.00
International
per $100 in coverage
$1.00 $1.25

It’s still better than the rates you get buying individually from the third-party insurance companies, but I haven’t tried it yet.


For more shipping tips see our main “Shipping” page–see the gold links on the right or click here:
Shipping Basics

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6 Comments | Add your own

  • . whyte | January 26, 2010 at 7:16 am | Permalink

    I tried Shipsurance after reading your blog entry Go To. Sooooo easy to do on-line. The proof in the pudding is the claim. I’m glad you shared claim results from U-Pic. It appears not too many shippers in my etsy world need to file claims which is a good thing. Thanks for taking the time to share!

  • . Ben | February 23, 2010 at 11:35 pm | Permalink

    Thank you for this But i am still searching for a 3rd party insurer that will cover Cell Phones! Maybe U-Pic does but they have minimums Etc.. I wish there was a full list.

  • . Sonja | February 24, 2010 at 11:42 am | Permalink

    You just made my day. Insuring my 1st class shipments is going to give me a lot more peace of mind and I’m sure it will help my customers feel more secure as well. Thanks so much for sharing this info!!!! I told Shipinsurance you sent me.

  • . GoTo | February 25, 2010 at 5:53 pm | Permalink

    Shipsurance might but you’d have to be shipping about 100 a month for coverage… let me know if you find another reliable third party shipping insurer. :)

  • . ShadowCutter | June 12, 2010 at 12:23 pm | Permalink

    what’s that about having to ship 100 a month? I keep seeing things that hint at that possible requirement but no definite \how things are\ about that. I only ship occasionally and only just started adding international so I need to know if I’ll have to be shipping all the time in order to use shipinsurance.

  • . GoTo | June 13, 2010 at 3:55 am | Permalink

    You can purchase insurance one package at a time as needed with either company. I think they just offer a discount if you ship enough to have a bulk account.

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