Getting insurance for international shipments bring peace of mind for both shippers and importers but filing, proving and getting paid for claims can be difficult. It can be particularly challenging when insuring direct with the carriers - which is ironic because this integrated approach has intrinsic advantages. However, we find shippers most often disappointed by the carrier's insurance.
As mentioned above, most shippers simply select "declared value" or other protection program from th carriers them self. This is as easy as checking the box and has the advantage of integrated processing, payment and shipping. However, the rules for getting approval from claims are both difficult and non-negotiable.
Please note that information presented in this post and all Jet Worldwide online content is for general information only. No representations are made that the information is error free. Shippers are advised to confirm details with their carriers, insurance providers and regulatory authorities prior to shipping.
The use of the term "insurance" is often avoided as using this term would subject the carrier to burdensome regulations related to capital reserves for property and casualty Insurance companies.
To avoid such capital reserve and other regulatory oversight, carriers often refer to their programs as "shipment protection" or "declared value".
Insurance is great to have in case your package is accidentally lost or damaged by the carrier. Confirm with the carrier that the product you are shipping can be insured.
This is among the easiest claims to get approval but the complicating part being when the carrier declares the shipment "lost" versus mis-routed or still in transit. Although such cases are rare, this is when it is best to have insurance direct with the carrier. Otherwise, there can be a discrepancy as to when the carrier declares the loss and when an insurance claim has to filed.
The most common reason for claims is for damaged goods caused by insufficient packaging. We advise our customers that the goods must be packed well enough to withstand the "standard rigours of courier handling." The definition of packing standards can get rather confusing (see section below on ISTA 3A standard) a good rule of thumb is if your package can goods cannot withstand a +5 foot drop to ground and other common sense measures.
Packaging Standards for Parcel Delivery System Shipment up to 70 Kg
Carriers often refer to the "ISTA 3A packaging standard" to define the type of packing required. to withstand the standard rigours of parcel handling. The tests 3A standard is a simulation test for packages shipped individually* through a parcel delivery system. The test is appropriate for different types of packages commonly handled by air and ground couriers: standard, small, flat and elongated packages.
* Packages originally shipped on a pallet may need additional packaging if then being shipped individually via a parcel carrier
Discretion is an important element for protecting your shipment. Nothing on the packaging or label should reveal the nature or value of your item. Beware of wording that might inadvertently convey the contents of your package. Obvious words that relate directly to valuables are strictly prohibited for insurance purposes.
For international shipments requiring a customs form, place the customs form under the shipping label inside the plastic bag provided by the carrier. Many carriers offer paperless trade whereby the customs invoice does not - in most cases - have to be included with the shipment.
Before shipping always take pictures of your item and its packaging. Once completed, take a photo of the final shipment with the shipping label visible.
It is critically important that the receiver take note of any damage at the time of delivery. We strongly encourage your recipient to refuse the package or to write clear notations of damage on the delivery slip explaining what is damaged. Also, notify both the insurance company and carrier immediately regarding the damage and include photographs. The recipients email address should be included when purchasing insurance.
Keep the damaged packages, boxes and pictures until processing of the claim has been completed.
Direct shipments and third parties can complicate and often invalidate shipment claims. For example, goods accepted by a third party, to virtual addresses, or parcel shops generally are considered invalid and can give cause for a refusal of a claim.
All insurance carrier have a time limit defining when a claim can be filed. The time from varies by provider but is generally within a week or two after delivery. Some insurance carriers state that claims must be filed within 14 days from when package is sent - versus when it was delivered.
Our advise is to self insure up to a level you feel comfortable. For example, it is probably best to simply take the risk for a $200 shipment as the insurance processes would likely not be worth the effort. Keep in mind that many insurance policies have a deductible when insuring for higher values.
It is important to remember that payment of insurance claims are for the actual value of the goods up to the insured amount. In other words, a damaged item valued at $2,000 would be covered for $2,000 even if it was insured for a greater amount.
The paperwork and data required to submit a claim varies by carrier but most often can include:
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