An Introduction to Shipping Insurance

shipping insurance

Nowadays insurance has become a common term. Everyone is familiar with the term insurance and what their benefits are. People get their home and car insured. There are life and health insurance as well. Moreover, you can get your phone also insured these days.

Well, they all are valuable items so, why not? Similarly, products that you are shipping are very valuable assets for your business. Their security should be a priority as any harm to your products will be incurred by you.

Now, let’s have a closer look at E-commerce shipping insurance and why is it important for your business.

Need for shipping insurance? 

With all those packages changing hands, you might be wondering is there even a need for shipping insurance. “It depends on the value of the package and individual risk tolerance,” says Ariel Shorrock, vice president of Shipsurance Insurance Service. Shipping insurance is a service that may reimburse the sender whose parcels are stolen, lost, or damaged in transit. 

Before you insure your shipments, there are certain differences between declared value coverage and cargo insurance.

Declared value coverage

It is the amount you place on a package you are handling to your courier for delivery, which establishes the maximum amount that he will be liable to pay if anything happens to that package in transit. It’s very important to understand that the courier will only be liable to pay if you prove that it was a result of courier negligence or if the problem persists with the item( damage, lost).

Cargo insurance

On the other hand, cargo insurance is the true shipping insurance that means it covers your package against damage or loss from the moment it is picked up successfully and is delivered to the customer’s doorstep. Cargo insurance also covers the cost above the package itself, including your freight costs. And unlike declared value coverage, cargo insurance will be reimbursed regardless of your ability to prove carrier negligence.

Benefits of Shipping Insurance

Shipping insurance brings a peace of mind where the maximum fiscal loss of insurance holder is depended upon the amount of deductible.

However, shipping insurance is complex for understanding because of the nature of this industry but it is indispensable for large shipments. For better understanding here are the following advantages.

Shipment Coverage

Shipment without insurance can lead to a financial loss for your company if it gets lost or damaged during transportation. Though insurance policy can be complicated as it involves a lengthy process along with carrier liability, nothing can be better than safe delivery to the desired location.

Accident Coverage

There is no specific list that is associated with a shipping insurance policy which means it covers all types of accidents regardless of the cause. Different mistakes like inappropriate handling, vessel sinking, saltwater exposure are also included in this policy. 

Location-Based Coverage  

Shipping insurance not only covers the shipment during their transit but also some damages can be caused at the port, therefore it covers that also. Moreover, there are certain chances of mishaps to the goods at the warehouse or during their road transportation. Some insurance companies provide all these in one single platform and some work individually. 

That’s why insurance holders should make a good choice before buying any insurance policy.

Conclusion

From all the above-mentioned points, we can conclude that Shipping insurance is of great importance for any E-commerce business, but at the same time, the insurance holder has to pay attention to the plan he/she is opting for. With the help of Shipping Insurance, you can protect your business from various losses that otherwise can affect the growth of your business.

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