Shipping insurance is a must, but the amount offered by carrier companies can be insufficient. Learn how 71lbs can raise that number for greater peace of mind.
Insurance can be a smart move, but it’s not one that every business considers nor makes for their shipments. Too many businesses place too much faith in FedEx, UPS, or the other big carriers doing their job in getting the goods from A to B, without any losses or damages. The fact of the matter is that this only leaves packages (and customer reviews) open to unnecessary risk.
We’re aware that eCommerce costs are rising, and we understand that shippers may see insurance as one expense too many. Businesses can’t afford to forget that reputations and bottom lines are built on shipments arriving not just on time, but also in the same condition the original item was shipped.
Insurance helps shippers fight a triple threat
Whether goods are damaged, lost or stolen, the customer’s bad feeling usually goes in one direction – straight back to the shipper. Recent research shows that billions of dollars of eCommerce purchases are being returned, and 20% of those returns were due to damage.
It could cost the shipper three times over – once to pay for return shipping, again for postage of a replacement item, and lastly in lost customers and bad reviews. This doesn’t even consider lost revenue from the replacement of lost/broken goods or the extra labor time required to fix a carrier’s mistake.
The costs mount up. The big carriers do offer coverage of their own, but this comes with conditions that make it less than ideal. Here’s why.
“Insurance” from FedEx
FedEx caps its own liability at $100 (cost of shipment and value of loss combined) unless the shipper declares the package to be worth more. Items of “extraordinary value” or the value of which is hard to ascertain get capped at $1,000. (There are even more conditions on their pledge page.)
These numbers can vary depending on the service chosen and nature of the goods being shipped. For example, for FedEx SameDay and SameDay City, the maximum declared value is $2,000, and the additional cost for declared value is $3 for shipments up to $300. One dollar per $100 is charged for declared values over $300.
This may seem reasonable until businesses take a closer look at the FedEx Service Guide. Buried in the small print of page 140 is the admission:
“Contact an insurance agent or broker if you desire insurance coverage. WE DO NOT PROVIDE INSURANCE COVERAGE OF ANY KIND.”
This shows that declared value coverage with FedEx is not insurance. Under this coverage, the big carriers will try to deny your insurance claims even when they’re at fault. The burden of proving carrier negligence falls on the shipper, making it a poor substitute for full insurance.
Insurance from UPS
UPS operates similarly, with total value claims higher than FedEx: $100 for every lost or damaged parcel with no declared value and up to $50,000 of declared value per package and $100,000 per pallet. Beyond this, UPS does offer actual insurance coverage via UPS Capital. This may seem like they have the edge on FedEx, but user reviews for shipping coverage under UPS Capital have not been kind.
One of the biggest criticisms is that UPS made the process laborious for shippers who had to qualify for coverage as well as go through a tedious application process before chasing down what they were promised.
Peace of mind from the right insurer is priceless
Insurance exists to offer some peace of mind to the policy holder. This is extra-important for business owners who have minds that are already in a hundred places at once trying to keep things running. It shouldn’t have to feel like pulling teeth to get the coverage you need.
Yes, premiums do add a little more to company expenses, but the ROI can be huge when that policy kicks in to help cover shipping, replace lost items and protect the bottom line. It can also make customers happier knowing the business cares enough to insure every shipment, while also giving them the option to pick and choose which shipments to insure.
Searching out and partnering with the best shipping insurer should be a top priority for businesses large and small, but where can they turn when the big carriers are far from perfect?
How 71lbs makes shipping insurance easy
We offer true parcel protection to our customers, the kind that provides coverage for the merchandise and the shipping costs without unrealistic conditions. Our easy coverage will insure your packages regardless of size when they’re sent via all the major carriers – UPS, FedEx, USPS and DHL. Our insurance costs less than buying coverage from those companies and could save your business up to 45%.
With 71lbs shipping insurance, your items are covered without having to prove negligence and you won’t get buried under paperwork. Getting started is easy, quick and supported by our dedicated team of shipping advocates. You can choose to which shipments to protect - you can protect some or all. The choice is yours.
Once you’ve got it in place, why not check out our other services like Premium Tracking and Invoice Auditing to completely revitalize your shipping process? See for yourself why 71lbs customers are so happy and how over 5,000 businesses are saving money every month working with us.
At 71lbs, we uncomplicate the shipping process for our customers, making it easier and faster for them to access refunds and reduce their expenses. Our automated platform gathers all your shipping information into one easy-to-use custom analytics dashboard. Drop by the contact page to get in touch.