Is Shipping Insurance Important? COST ANALYSIS & BUYING GUIDE

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international shipping insurance


Dealing with lost, damaged, or stolen packages can be a nightmare. But it’s even worse when it happens to one of your customers. It’s a nagging problem that online retailers deal with all the time.

However, there are ways you can take to protect your package and your business along the way.

International shipping insurance may be the best solution to this common problem.


What Is International Shipping Insurance?

International shipping insurance is a type of insurance that provides coverage for goods that are being transported from one location to another.

It is designed to protect the shipper and the receiver from financial loss if the goods are lost, damaged, or stolen during transit.

The shipper typically purchases international shipping insurance, responsible for the goods until they reach their final destination.

The cost of international shipping insurance is usually based on the value of the goods being shipped and the distance they are being transported.


How Much Does International Shipping Insurance Cost?

The exact cost of international shipping insurance varies depending on the carrier and the value of the package contents.


air shipping


USPS International Insurance Costs:


$1.65 for contents up to a $50.00 value

$2.05 for contents valued between $50.01 and $100.00

$2.45 for contents valued between $100.01 and $200.00

$4.60 for contents valued between $200.01 and $300.00

$4.60 + $0.90 per every $100 in value over $300.00 — up to $5,000


FedEx International Insurance Costs:


$0 for contents up to a $100.00 value

$3.00 for contents valued between $100.01 and $300.00

$3 + $1 per every $100 in value over $300


UPS International Insurance Costs:


$0 for contents up to a $100.00 value

$1.05 per every $100 in value over $100.00

UPS has a $2.70 insurance minimum, so the contents’ value must be at least $300.00 to qualify.


How Do You Claim Transportation Insurance?


The problem of claiming from the international shipping insurance company arises when the insured has suffered damage to the goods insured.

The insured shall go through the claim formalities with the international shipping insurance company following the policy’s provisions and also complete the necessary formalities with the carrier as the consignee to safeguard his claim rights.


Notice of loss

When the insured becomes aware of or discovers damage to the insured goods, it shall immediately notify the insurer so that the insurer may inspect the damage, advise on salvage, determine the insurance liability and check the liability of the consignor or carrier.

Delay notice will delay the insurer from carrying out the relevant work, cause objections, and affect the claim.


express delivery


Filing a claim for compensation

Suppose the insured or his agent  finds that the goods are obviously damaged or the whole package is missing when taking delivery of the goods.

In that case, he shall, in addition to reporting the damage to the insurance company, immediately ask the carrier, the trustee, the customs and the port authority, etc., for a certificate of the damaged and defective goods.

When such losses involve the carrier’s liability, the trustee or other parties concerned, such as the dock and stevedoring company, claims shall be immediately submitted to them in writing, the right to recover shall be reserved, and the limitation of claims shall be extended if necessary.


Taking reasonable rescue and sorting measures

After the insured goods are damaged, the insured shall take measures concerning the damaged goods to prevent further damage.

In particular, for damaged goods, the insured is still required to assist the insurer in reselling, repairing and resurfacing.

Since the insured is more familiar with the properties and uses of the goods than the insurer, in principle, the buyer should dispose of the damaged goods.


Prepare all the necessary documents for the claim.


  1. Original insurance policy or certificate;


  1. Contracts of transport, such as bill of lading, waybill and postal order;


  1. Goods invoice;


  1. Packing list and pound size list;


  1. Written documents to claim compensation from the carrier or the responsible party;


  1. Inspection report;


  1. Extract of maritime report or maritime declaration;


  1. Proof of damaged goods and defective goods;


  1. Statement of claim.


It can be known that the transportation insurance premium is calculated according to the premium rate.

After the purchase of insurance, if the goods suffer from misfortune, the insured will receive a notice of loss.

Currently, the insured can file a claim with the insurance company. Generally speaking, companies will accept claims in order to protect their reputation.


Cargo Insurance


International freight insurance rates

Different logistics companies have different ways of charging, which are generally divided into several points:


Charge according to weight

It is based on the gross weight of the goods sent to calculate the transportation cost, provided that the volume of the goods is within the specified range.


Charge by volume

This method calculates the cost of shipping the goods based on the volume of the goods sent, which also requires that the quality of the goods be within the specified range.


Charge according to the selection

If the weight and volume of the goods are difficult to discern, choose an appropriate pricing method from the above two methods.


Integrated quality and volume billing

According to the gross weight and volume of the goods, respectively calculate the transportation cost, and select the highest freight.


Charge based on the number of pieces

According to the actual number of goods calculated freight, this billing method is generally suitable for more expensive items.


Charge as agreed

This is the freight rate calculated according to the price agreed by the shipper and carrier in advance, such as the delivery of large machinery.



International shipping insurance is essential to shipping, but it’s only sometimes necessary. By following our tips for reducing the chances of something going wrong with your shipment, you can avoid paying for insurance altogether.

If you need to purchase international shipping insurance, make sure you know what it covers and how much it costs.

Globallyfulfill  can help with all your fulfillment needs; feel free to contact us today if you have any questions about shipping insurance or anything else related to fulfillment!


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