Small Package Shipping Insurance FAQs

Are your shipments completely protected from loss, damage or theft? The differences between carrier liability and parcel shipping insurance are often misunderstood by small and mid-sized business (SMB) shippers. Customers expect a seamless shipping experience — especially when it comes to post-purchase support. 44% of consumers will stop shopping at a retailer if there’s no resolution support for shipping issues.1 In other words, investing in shipping insurance can have a positive impact on your customer relations — and as a result, your bottom line.

Keep reading for answers to some common small package shipping insurance questions.

What is parcel shipping insurance?

Small package shipping insurance is a service that protects the shipper when packages are lost, damaged or stolen. If an insured package doesn’t reach its destination or it arrives damaged, you’ll be reimbursed the full retail value of your shipment.

What is carrier liability?

Many SMBs assume that their shipments are automatically insured through carrier liability. The reality is that carriers are responsible for some of the loss associated with lost, stolen or damaged packages. In fact, if you don’t declare the value of your shipment, the maximum liability from UPS is $100. In the end, carrier liability has limits and shouldn’t be solely relied on to protect your shipment’s value.

How does insurance differ from carrier liability?

While carrier liability can protect a portion of your shipping expenses from carrier error, parcel shipping insurance provides comprehensive coverage on your shipments — regardless of who’s at fault.

What does parcel shipping insurance cover?

Parcel shipping insurance with InsureShield™ through UPS Capital® provides the following:

  • Full value repayment. With parcel shipping insurance your goods are covered up to their full retail value with only minimal investment. With a starting rate of $1.80, you can cover up to $400 in value.
  • Disaster and theft protection. Unlike carrier liability, small package shipping insurance covers all types of weather- disaster- and theft-related loss or damage — other than service guarantee failures.
  • Comprehensive, specialty coverage. Shipping insurance is available for many specialty and high-value items that are not traditionally covered by carrier liability. For example, gift cards, event tickets, jewelry and perishable goods.
  • Faster claims process. SMBs have come to expect a lengthy claims process with carrier liability cases. With small package insurance, you can rest assured that claims are processed much faster than direct carrier claims.

Why should you choose shipping insurance?

For SMBs like yours, small package insurance doesn’t just protect your packages — it protects your bottom line. In fact, the most common shipping-related challenge reported by SMBs is financial loss due to shipping replacement orders. By investing in insurance, you can give your customers an exceptional shipping experience without breaking the bank.

How can I add parcel insurance to my next shipment?

For Unishippers customers, adding parcel insurance is easy with our transportation management system (TMS). Simply apply it to your future deliveries when you get a shipping quote or add it when you book a shipment. To get started, request a quote today or contact us for answers to any other questions. We have a dedicated support team ready to help you select the right coverage for your SMB’s unique shipping needs!

1UPS Capital (2021). Post-Shipment Experience Survey.