Should I Buy Shipping Insurance?

Posted by Benjamin Meskin on Jul 14, 2020 9:11:00 AM
Benjamin Meskin

Buying shipping insurance covers your business in case parcels you deliver are damaged, lost, or stolen. You can purchase coverage and get reimbursed for items that get lost, damaged or stolen in transit.

There are a number of benefits that result from buying shipping insurance, such as reducing risks, protecting cash flow, and enjoying peace of mind. 

Purchasing international shipping insurance can provide peace of mind when sending high-value items or large bulk orders of cumulative value around the world. You can choose which particular carrier you want to use, such as UPS, DHL, USPS, FedEx or local and regional carriers. You can also get shipping insurance for the majority of countries for international orders.  All shipments can seamlessly be tracked in real-time, and any losses during the delivery process can be covered through reimbursements.

How to Insure Your Shipment

Once you have your goods ready to ship, you can buy shipping insurance or freight insurance from a trusted provider. Automated platforms simplify how to customize your products and schedule coverage. For instance, will you purchase cargo insurance, or will your coverage be based on the declared value? 

Declared Value Coverage Shipping Insurance

With declared value, you determine and record your item’s value. If the item gets damaged during the delivery process, you will need to file a claim and prove its worth to get reimbursed for the declared amount. This coverage is not insurance, but it provides financial liability. Declared value is useful if making a one-time shipment or when you have less costly items to ship.

Cargo Shipping Insurance

Cargo insurance, or freight insurance, covers items from when they first leave the warehouse to when they arrive at the destination. This door-to-door protection can pay for replacing goods if physical loss or damage occurs. Other cargo insurance examples include customs rejection, infestation, or cargo abandonment. Coverage remains attached to the cargo no matter if it was damaged due to, for example, a carrier’s negligence. 

Cargo Insurance options include: 

  • All-Risk policy - covers loss or damages
  •  Free of Particular Average - covers collisions or some acts of God
  •  Shipment-by-Shipment - covers one shipment at a time

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When Should I File a Shipping Insurance Claim?

When it comes to insuring packages you send out to customers, make sure to stay up-to-date on  deliveries. As soon as you find out that your package is damaged or lost, you should file a claim. 

Be sure to stay mindful of cutoff times and deadlines, so you don’t miss your window of opportunity. For instance, for USPS Insured mail, you need to file 15-60 days from the mailing date. FedEx, on the other hand, requires you to file within 60 days of the shipment date.

To file a claim, be sure to fill out a standard damage claim form. On the form, document:

  • a list of what was damaged
  • proof of the damage
  • evidence of how it was packed
  • a signed statement proving that a courier took responsibility for the package 

You will also need to declare its value and show proof of how much it is worth, by showing an invoice of the product’s cost, cost to ship, any insurance tied to it, etc. 

There are some exceptions to filing a claim. For instance, if you package it inefficiently, or if the courier forbids the items, or if the package got sent to a country that was not included in the list of countries that are insured, you may not get to make a claim.

The entire process of collecting evidence to file for a claim, and then having the insurance provider verify and calculate value and losses can take a long time. These tedious administrative tasks can take several months to resolve. Delays can also spring up, especially if something is filled in inaccurately. It is thereby imperative to work with a third-party insurance company that can make the process easier, quicker, and more customized to your business’ needs.

How Much Does Shipping Insurance Cost?

There are varying prices when buying shipping insurance from different companies. USPS charges $10.05 for priority mail express international insurance for a product worth $400.01-$500. Extra fees may be added for special services such as attaining international proof of mailing and delivery, such as a return receipt or certificate of mailing. Rates can vary by country and can be subject to size and weight limits as well.

When choosing shipping insurance, be sure to go with a provider who can offer discount prices, pay-as-you-go plans, and user-friendly software to keep track of all of your purchases. Cabrella’s shipping insurance software allows you to monitor the insured value of your products, receive real-time notifications with your carriers, record transactions, check invoices, file claims, and review coverage details at any time.

 

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How Can You Further Secure Your Packages?

Some vital shipping and packaging guidelines include the following tips:

  • Package Items Properly into Boxes: Fill up spaces inside boxes, so products do not shift or move around. You can use crumpled up or shredded paper, bubble wrap, or other cushioning materials. Consolidate smaller parts into sealed containers, such as into plastic bags. Be sure to wrap products individually with air-cellular cushioning, so they are protected. Heavier items such as books should be shipped in sturdy boxes and placed under more fragile items if shipped with multiple products. Start packing from the bottom and then move up to the top.
  • Have the Right Materials: Use new or like-new boxes that have not experienced any wear or tear. Use specially designed boxes for uniquely shaped or fragile items. Furthermore, use proper packing tape to secure and ensure boxes do not get opened during delivery. Lastly, use newspapers or foam peanuts to keep your items from getting damaged.
  • Obtain Tracking and Proof of Delivery: You want to make sure you know where your products are, for yourself and for your customers expecting them. In case products get lost, you can determine where they were placed last. Furthermore, you can keep track of how long it takes to complete your delivery. Lastly, have someone sign to confirm when they receive your package. This could be the package room of a high rise building or the actual customer recipient who signs to show proof of delivery.

Final Thoughts on Shipping Insurance

Cabrella Shipping Insurance Intelligence offers a plethora of perks when buying shipping insurance. It allows you the ability to keep track of all your claims, invoices, and tracking via their online software. They work with big-name carriers such as UPS and FedEx and offer better rates with customized plans to navigate multiple shipments throughout the world. Cabrella has faster claims processing, with a guarantee of receiving payments within 30 days for products worth up to $20,000.

To learn more about Cabrella Shipping Insurance Intelligence and all it has to offer, contact the experts at Cabrella at 844-422-2735. Our professionals will be happy to answer your questions.



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