Shipping insurance can be essential for many ecommerce businesses that sell high-value items; even one damaged shipment could wreak havoc with your bottom line and customers’ happiness levels.
Major carriers and third-party vendors offer shipping insurance at rates determined by an item’s declared value, but is it worthwhile?
Cost
Shipping insurance provides businesses with financial protection in case their packages go missing or get damaged during shipping. Available from major carriers and third-party providers, prices depend on declared value of package(s). Including this service in your shipping workflow could save time and money while safeguarding its reputation – giving your business the edge against potential competitors.
Cost of shipping insurance depends on several factors, including carrier, type of coverage and policy type. On average, however, it typically falls within one percent of the total value of goods being shipped and many providers offer multiple coverage options so you can choose one which best meets your needs.
Shipping insurance can do more than protect your bottom line; it can also increase customer retention. According to research by FarEye, an ineffective delivery experience can lead to lost sales that total hundreds or even thousands of dollars annually – so investing in the appropriate shipping solution is vital in creating exceptional customer experiences that keep customers coming back!
Shipping insurance provides many advantages to eCommerce businesses, from protecting themselves against financial loss and liability to improving customer satisfaction and lowering fraud risk. Furthermore, shipping insurance may help businesses that ship high-value items significantly reduce risks such as fraud or theft.
When it comes to shipping insurance, there are two primary choices available to businesses and consumers alike: seller and buyer insurance. With seller insurance, businesses purchase coverage directly from carriers or third-party vendors; with buyer insurance, customers pay a small fee during checkout to cover themselves against shipping risks; this option typically proves more cost effective while still enabling tracking packages and filing claims easily.
Shipping insurance provides both customers and businesses with peace of mind, and may even reduce time and costs by choosing the appropriate carrier plan or third-party insurer. When your goods are of high value or fragile construction, third-party protection could prove invaluable and save both time and money in shipping expenses.
Coverage
Shipping insurance provides protection in the event that a package is lost, stolen, or damaged during transit. It’s typically available through major shipping carriers as well as third-party vendors and the cost varies based on declared value and carrier; it’s usually more affordable than paying out-of-pocket for losses or damages.
Purchase shipping insurance can be an investment worth making for businesses shipping expensive or fragile items, as it reduces stress associated with negative customer experiences. While ultimately it is up to each business’s discretion whether or not they decide to invest in shipping insurance policies, it is essential that several factors be taken into consideration prior to making this decision.
Ecommerce businesses should first ascertain the value of a shipment before purchasing shipping insurance, which will allow them to identify which types of items qualify for coverage. Most major carriers do not insure shipments containing precious stones or coins; however, third-party insurers specialize in insuring such items and can provide more flexibility and coverage options than major carriers.
Understanding the different forms of coverage available is also critical for ecommerce businesses. There are two primary forms of shipping insurance – seller and buyer insurance. Seller insurance typically purchased by businesses themselves while buyer coverage can often be added as an optional feature during checkout; oftentimes seller insurance is more cost effective.
As a general guideline, all packages valued over $100 should have shipping insurance. While most packages arrive safely without incident, accidents do happen and it would be disastrous if an expensive item were to be lost during transit.
Ecommerce businesses can supplement the coverage provided by major shipping providers with third-party shipping insurance from Shipsurance, offering flexible policies at discounted rates from major carriers, while covering more items than their major counterparts, including dangerous goods, artworks and antiques. While purchasing third-party insurance may take some getting used to, ultimately it can save businesses money over time.
Exclusions
Shipping insurance can be an invaluable tool for online stores selling high-value products, helping reduce risk and giving shoppers confidence that their orders will arrive safely and on time. Before investing in shipping insurance coverage, however, it’s crucial that both costs and coverage are understood before purchasing this service. In doing so, one should determine whether its peace of mind justifies any additional expense that may incur.
Shipping insurance comes in various forms, from carrier-provided policies and third-party policies. Carrier-provided coverage often covers packages up to a certain value and is included as part of the shipping rate, while third-party policies offer wider coverage with higher limits at an additional fee; however, these services often come with restrictions or exclusions not found within carrier-provided policies.
Typically, shipping insurance costs vary based on product value and shipment volume; however, major carriers often already include some level of coverage on all shipments. To secure the best rates possible, it’s a good idea to compare quotes from multiple last mile carriers and third-party insurers.
Considerations must also be given to what type of damage is covered by your policy, with some policies covering only specific perils while others offering all risks as coverage options. As the more extensive your coverage becomes, so will its premium increase accordingly.
As much as ecommerce businesses would rather their merchandise arrive safely at its destination, sometimes damage occurs during shipment or loss in transit can still occur – and according to a 2017 Statista Consumer Survey, 80% of consumers cited broken or damaged items as the reason they returned their purchases!
Add shipping insurance to your package deliveries to reduce costly returns, give customers peace of mind, and demonstrate your care about their shopping experience. While most major shipping carriers provide reliable delivery service, mistakes do happen and packages could become lost or damaged during transit – shipping insurance can help minimize your financial losses while protecting both customer loyalty and sales growth by protecting both parties involved in transit.
Claims process
Shipping insurance can be an invaluable asset to high-volume shippers, including ecommerce businesses that depend on shipping expensive or fragile items. When making this decision, several things should be kept in mind before determining if shipping insurance is worthwhile: For instance, take into account how much monetary value each shipment holds should it become damaged in transit and also the process for filing claims and recovering reimbursement can be complicated – therefore consulting with a knowledgeable third-party shipping insurer such as Cabrella is advised.
When reviewing shipping insurance options, look for policies which offer both carrier liability and excess coverage. Carrier liability provides basic protection up to $100 declared value while excess coverage offers greater liability and higher reimbursement amounts. It is also wise to compare terms and conditions across policies to ascertain what kinds of losses they cover and which ones don’t.
To file a shipping insurance claim, your business must present all relevant paperwork to the carrier, such as shipment information, receipts and proof of value. Typically, insurers reimburse insured amounts within five business days after receiving all documents; this timeline can differ depending on insurer and nature of loss.
Some carriers include shipping insurance as part of their service rates; others charge an additional premium. Typically, the more costly an item is, the higher its insurance costs will be; carrier-provided policies usually only offer protection up to $100 per shipment while third-party policies offer much broader protection.
As part of your cost of shipping insurance, it is essential to remember that premiums aren’t an additional burden on your business – rather they represent an investment in safeguarding shipments from mishandling during transport, giving customers peace of mind that their high-value purchase won’t get lost or damaged during delivery. Thus it is an ideal solution for high-volume ecommerce brands; however, for maximum protection it should also prioritize secure packaging practices and follow shipping guidelines to reduce risks as much as possible.