Shippo Updates
Sep 21, 2023

Protect Your Packages With New and Improved Shipping Insurance from Shippo

In the fast-paced world of modern e-commerce, seamless shipping is a top priority for all businesses. However, reports show that more than 1 in 10 packages arrive damaged, over 1.7 million packages nationwide get lost everyday, and 49 million Americans have had at least one package stolen in the past 12 months. These occurrences result in unhappy customers as well as hurt a business’ bottom line, which may impact their ability to provide the best customer experience.

That’s why Shippo is pleased to introduce an elevated shipping insurance experience within our multi-carrier shipping software that helps merchants further protect their bottom line and improve customer satisfaction.

Through our new partnership with XCover, Shippo users will now be able to protect more packages for less. The claims process is also quicker and easier so you can stay on top of your own business’s finances and better serve your customers. We’ll walk you through all the exciting benefits of this new enhancement, such as porch piracy coverage, global coverage, and more affordable pricing to name a few.

What’s New With XCover Shipping Insurance Through Shippo?

Shipping insurance has long been a feature we’ve recommended to our users to add to their packages as it allows you to give yourself and your customer ultimate peace of mind. But, with the latest revamp of our insurance feature, you’re able to benefit so much more. Some of our latest enhancements include:

Porch Piracy Coverage

With nearly 1 in 7 Americans falling victim to porch pirates last year, the need to protect against package theft is more significant than ever. This number is estimated to grow with an influx of packages in the upcoming holiday season. You can now protect your profit margins even more now that stolen packages are covered.

Global Coverage

It’s commonly known that the longer a package is in transit, the more likely it is to get lost or show up to your customer's doorstep damaged. While merchants could only add shipping insurance for outbound shipments originating from the U.S. in the past, coverage is now extended to packages being shipped from other high-value e-commerce countries.* This is especially beneficial for those who have fulfillment networks that exist in the U.S. as well as another country, since you can now ship international orders from that fulfillment center with the same protection that you give to your U.S.-based shipments.

*As of September 21, coverage is only available for shipments originating from the United States, Canada, United Kingdom, Germany, France, Spain, Italy, and Netherlands. Coverage for other countries will be coming soon. Global coverage is not offered for shipments originating from or traveling to countries that violate UN resolutions or the laws and regulations of the E.U., U.K., and USA.

Easier Claims Process

Rather than playing email tag with an insurance representative, you can now handle the entire claims process through the XCover online portal. You can be directed to this online portal from within your Shippo dashboard where you can then file a claim quickly and seamlessly. You can also track the status of your claim within your online portal as well. About 95% of claims only take up to 3 days to fully process and be completed.

No Minimum Fees

There is no longer a minimum $1 charge for shipping insurance for order values under $100. Instead, you’ll only pay 1.25% of your package's value for domestic orders and 1.50% on international shipments, no matter what the order value is. Let’s say you’re shipping a domestic parcel with items inside that total $20. Rather than having to pay $1 for shipping insurance, you now only have to pay $0.25 cents. For merchants who sell lower-value items, shipping insurance is now much more affordable.

Fewer Coverage Restrictions

For many businesses, sending custom shipping boxes and branded packages is an additional way to increase brand awareness. In fact, around 40% of consumers say they always publish a package to their social media accounts if that package is delivered in a branded box. With our upgraded insurance offering, you can now send parcels decorated in your brand without having to sacrifice protection. On top of that, signature requirements have become a more straightforward process and high value products that are more susceptible to damage in transit such as LCD/LED TVs and computer monitors are now covered as well.**

**some restrictions apply

Which Items Do Not Qualify For Shipping Insurance?

While there are fewer restrictions in our upgraded shipping insurance offering, there are still certain items that do not qualify. Some of those items include:

  1. Perishable Items: Food, pharmaceuticals, plant matter, chemicals, etc. (The exception to this is wine.)
  2. Valuables: Precious metals and stones, cash, bullion, securities or documents
  3. Illegalities: Claims resulting from things such as shipping contraband goods.

For more information on what is not covered, check out XCover’s Shippo help center.

How to Use Shipping Insurance With Shippo

Adding shipping insurance to your orders within the Shippo web app is a quick and easy experience that can be done during the label purchase process. To do so, you’ll need to:

  • Navigate to the Orders page and create a label.
  • Input package details, additional options, select a carrier service level, and click buy at the bottom right-hand part of the screen.
  • The side panel will then prompt you with an option to add insurance and a signature requirement.
  • Click “Add” next to the covered amount to specify how much of the item’s value you’d like to cover. It will default to be the total value of the item.
  • Once you’ve determined the amount, click add insurance at the bottom right-hand side.
  • You’ll be directed back to the side panel with the total cost of the shipment (including insurance) displayed.
  • Select the buy label at the bottom of the screen and you’re all good to go.

Instead of insuring orders one by one, you can also add shipping insurance automatically to all shipments or shipments over a specified value to save time.

Keep in mind that certain items, such as laptops, TVs, and parcels containing jewelry worth more than $250, are required to add signature confirmation to their shipment to be covered.

You’ll need to confirm whether or not the items you’re trying to ship are covered by Xcover. Terms and conditions for using XCover through Shippo can be found at the bottom of the side panel within the web app before you make your purchase.

For Shippo API users, the process for adding shipping insurance to your parcels is different but still developer-friendly. Instructions can be found within our API docs.

To learn more about how our upgraded shipping insurance feature works in Shippo, check out our latest customer support page.

When to Use Shipping Insurance

Shipping insurance is a crucial asset in the logistics landscape, offering protection and peace of mind for businesses and customers. Knowing when to leverage shipping insurance involves a strategic evaluation of risk and cost factors.

Items of high value, fragility, or limited availability warrant the use of shipping insurance. This extra layer of security shields against potential damage, loss, or theft during transit. Likewise, international shipments with their intricate routes and various touch points benefit greatly from shipping insurance. By safeguarding against the uncertainties of global logistics, you enhance your reputation for reliability.

During peak seasons, like holidays or promotional periods, shipping networks can face strain, leading to delays or mishandling. Utilizing shipping insurance during these spikes anticipates potential setbacks and ensures consistent customer satisfaction.

However, with shipping insurance through Shippo now being more affordable than ever no matter the value of the item, you may want to consider adding shipping insurance automatically to all shipments.

This makes the shipping workflow easier on your fulfillment team and gives your customers and business maximum protection year-round. You’ll want to factor in your historical data to see how often your packages are lost or stolen and compare that to the cost of adding shipping insurance across the board to make the best decision for your business.

By carefully assessing product attributes, destination, and shipping volume, you strategically apply shipping insurance, reinforcing your brand's trustworthiness while efficiently managing risks.

Shipping Insurance FAQs

What do I need to provide when filing a claim?

This will depend on the claim you’re trying to file. If you are submitting a claim for a damaged package, you’ll need to provide photos or videos of your damaged items, photos or videos of the original packaging, a commercial invoice, and a shipping receipt or invoice. When submitting a claim for a lost or stolen package, you’ll need photos or videos of the original packaging, a commercial invoice, shipping receipt, a police report (only needed for porch piracy), and proof of ID (also only needed for porch piracy claims.) You may be required to submit additional documents, but having this paperwork ready will expedite your claim processing time.

Does packaging impact shipping insurance coverage?

For merchants who use custom boxes, you may add shipping insurance to those packages. This allows you to extend your brand awareness while also giving your customers coverage against any shipping issues.

How long does a shipping insurance claim take to process?

After filing a claim through the Xcover portal (with the proper documentation), you should expect that claim to be processed and completed within 3 days. About 95% of claims submitted to Xcover are processed within that time frame.

How much does shipping insurance cost?

Shipping insurance through Shippo costs 1.25% of the total value of the parcel for domestic shipments. For international parcels, that cost is 1.50% of an order’s value. This percentage is the same no matter which plan you’re on or how much the item you ship costs.

Does shipping insurance also cover the shipping label cost or just the cost of the items inside the package?

XCover will cover both costs. You just have to make sure you add the shipping label cost and item cost when filing a claim with XCover.

For more FAQs, check out our previous blog here.

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Hasan Nabulsi
is the Content Marketing Manager at Shippo.

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