For many online retailers shipping insurance feels like a waste of money. Until a package gets damaged or lost…then you wonder why you didn’t spend a few extra euros.
But when exactly is it wise to insure your packages? For example: when is a shipment insured by default?
Where do you do that and how do you make a claim if an insured package is damaged or not delivered?
This complete guide to shipping insurance will answer all these frequently asked questions.
Why is shipping insurance worthwhile?
You assume that your packages will be delivered to your customer in good condition.
After all, you pay shipping costs to the delivery company and everything usually goes well.
But carriers dispatch millions of packages every day, at home and abroad. That creates a high risk of damage to or even loss of a package.
And not only do you lose the shipping costs and the value of the original package, you also have to pay for a replacement and pay the shipping costs again.
Whether to buy additional insurance or not is always the question when sending packages…
Frustration for you and your customer
Although you’re not directly responsible for damage or loss (if you packed the shipments properly), you are responsible for the fact that your customer bought something from you and you owe it to them.
That’s why your customer will always come back to you if something goes wrong.
They want to receive their order as soon as possible in good condition. If that doesn’t happen, you can expect a negative review to be posted quickly.
The advantages of insuring your packages
Since there’s always a risk that packages will be damaged or lost, it’s often wise to insure them. Consider the following advantages:
- Provided it’s properly packed, you will be compensated for any damage to or loss of your package
- You’ll receive the purchase value of the order + shipping costs, allowing you to send your customer a replacement at no cost to you
- It gives you security and you can offer your customers fast service when something goes wrong
Even if you don’t want additional insurance by default, remember to always insure your packages during the holidays.
Carriers sometimes process up to 300% more packages than normal during that time, increasing the chance of loss or damage.
When is shipping insurance the sensible choice?
Shipping insurance isn’t always necessary. We suggest this rule of thumb: insure the items you cannot afford to replace in the event of damage or loss.
That means it’s wise to insure packages with a higher value. Shipping insurance is also the sensible choice when shipping internationally.
After all, multiple parties will be handling your packages during the shipping process, which increases the chance of problems.
Insured by default?
Added insurance is not always a must, because some shipping options include insurance by default.
Always check the terms and conditions of the carriers you ship with before taking out insurance.
If there is no standard insured amount, you can take out additional insurance yourself.
You can also choose to take out additional insurance if there is standard insurance for a certain amount, but it’s too low to cover all the contents of your package.
Want to read more? Check out our article about e-commerce logistics
How can you insure your packages?
You basically have two options for shipping insurance: arrange it directly with the carrier or use our Sendcloud Insurance. We’ll explain both options!
Shipping insurance through the carrier
We already noted that some carriers insure your shipments by default. This is often enough for shipments with a small value.
But if that value is not sufficient or if there is no default insurance, you can get additional insurance on your shipments through your carrier.
Please note that the conditions for shipping insurance differ per carrier.
Make sure to read each carrier’s terms carefully so you know the conditions your packages have to comply with, what is excluded and how to file a claim.
And if you use a shipping tool like Sendcloud, you can get cheap and fast insurance through Sendcloud Insurance.
Shipping insurance from Sendcloud Insurance
If the high costs and long waiting times for claims via carriers are not appealing, Sendcloud Insurance can be a good solution.
- Easily submit claims directly from your dashboard
- Affordable rates: insure your shipment for as little as €0.45
- Claims are processed faster (within 15 days)
- You can insure for any amount from €100 to €5000
- Supplementary insurance for individual packages as well as multiple shipments made at the same time
With smart shipping rules, you can even insure automatically, without having to think about it!
For example, you can set a rule that all shipments above a certain order value will be insured by default for an amount of your choice.
How do you insure shipments with Sendcloud Insurance?
You can take out Sendcloud insurance directly in your Sendcloud dashboard. There you can choose the insured amount from €100 to €5000.
You can select this per single package or for multiple shipments simultaneously.
Good to know: if you haven’t set up smart shipping rules, you need to insure packages before you process and print the orders. Follow these steps to insure your packages:
Step 1: select the package(s) you want to insure
Step 2: select the insured value, from €100 to €5000
Step 3: print the shipping label and ship the package with the benefits of shipping insurance
You can find the conditions of the Sendcloud Insurance in our help center
What should you look out for when sending insured packages?
Insured shipping offers a lot of advantages, but there are things you have to look out for to really benefit from it.
We’ll list the most important points for you:
- Carefully check the value that can be claimed: if your shipment is underinsured, it’s a waste of your money
- Comply with the mandatory packaging requirements to qualify for pay-out
- Take note of excluded products to avoid being insured for nothing
- Pay attention to excluded destinations to avoid a rejected claim
- Make sure you keep proof of delivery so you can show it when claiming damages
The list of excluded products and destinations depends on the insurance you choose for your product.
If you use Sendcloud Insurance, you cannot insure the following products:
- Flowers and plants
- Fine art
- Cotton (in it’s processed / unprocessed form)
- Fresh foods*
- Live animals
- Loose precious stones and metals
- Securities and other negotiable papers
- Personal good
- Bulk products
- Laptop computers
- Computer chips and similar memory devices
- Mobile Phones
Some countries pose extra risks, so insurance companies exclude them.
Sendcloud Insurance does not cover shipments to the following countries:
- North Korea
How do you make a claim?
It’s extremely annoying when a package is damaged or lost. But, if you’ve insured the shipment, you can file a claim with the carrier or Sendcloud.
To file a damage claim, you need the following:
- Purchase invoice
- Sales invoice
- Photo of the inside packaging
- Photo of the outside packaging
- Photo of damage to the product
- Proof that the package was damaged
What if your shipment is lost?
If your shipment is on the road longer than planned, it may have gone missing. Still, a delay doesn’t always mean trouble.
The carrier must be the first to declare that a shipment is officially missing. That often involved 10 waiting days.
In the meantime, the shipment can still be found and delivered. During that time, you can make inquiries about your shipment, but cannot yet make a claim.
You can start a lost shipment claim after these waiting days.
The following information is required to do that:
- Shipment tracking code
- Pick-up and delivery addresses
- Date of pick-up or drop-off at a service point
- Physical characteristics of the shipment (colour of box, colour of tape, dimensions and weight)
- Accurate description of your shipment’s contents
- Purchase and sales invoices
- Proof of your customer that it didn’t receive the parcel
You can then send this information to the customer service department of the party you shipped with, such as Sendcloud or direct package carriers.
If your package is additionally insured and has been declared missing, you will receive the purchase value including costs of the shipment.
Submitting a claim to the carrier
Each carrier applies different conditions to submitting a claim for a package.
These differences not only apply to how to file the claim, but also to waiting time (in the hope that the carrier will deliver a lost package after all).
You also need to consider the different handling times per carrier. Normally, claims handling with DHL takes up to 10 working days and DPD sets a deadline of 20 working days.
Read all about making a damaged or lost shipment claim to various carriers in this article.
Submitting a claim to Sendcloud
If you are insured through Sendcloud Insurance, you can easily make a claim by going to ‘support’ in your shipping dashboard.
You will receive a response about the claim from us within 15 days.
You can find the exact procedure and all conditions of Sendcloud Insurance in our help center.
Want to know what it would cost to insure your shipments?
We hope this article about shipping insurance has helped you.
If you have any questions, feel free to leave a comment or contact us. We’re here for you!