Shipping Insurance—How to Avoid the Scary Side of Shipping

By Baillee Perkins
Oct 14, 2022
Shipping insurance can help if shipments are damaged or lost

Words like “scary” aren’t usually found around the winter holiday season. However, sometimes things happen in the shipping process that threaten to ruin your customers’ gift-giving. And, you don’t want to have to cover reimbursement expenses if you can avoid it. Not having protection like shipping insurance can make a bad situation even worse. If your heart is racing and your palms are sweaty, it’s okay! We’re going to give you the rundown of why shipping insurance matters, what can go wrong in transit, and what you can do to help avoid the scary side of shipping. 

Table of Contents

  1. Why is tracking information important?
  2. How does shipping insurance help with damaged packages?
  3. Why are packages lost?
  4. How does insurance work with international shipments?
  5. How does ShippingEasy help?
  6. Conclusion
Take your holiday shipping from scary to merry with a 30-day free trial of ShippingEasy!

Why is tracking information important?

Although shipping delays aren’t covered by insurance, carriers like USPS give customers the option for credits or refunds when shipments don’t arrive during the selected service’s guaranteed time frame, as long as they’re eligible. For example, Priority Mail Express shipments are eligible for a refund if a package isn’t delivered by 6PM on the first or second day of the delivery window, depending on the circumstances. Plus, ShippingEasy users can submit the refund given by USPS if they weren’t issued a full refund, and our team will review the refund and pay the difference.*

That’s why tracking information is so important. Not only do your customers use it to follow their shipments, but tracking information from USPS shows your shipment’s estimated delivery date as well as any delays along the way. If your tracking information is showing your shipment is delayed or has any hiccups, you can proactively gather the information you’ll need to submit a refund request with USPS. This way, you can immediately start the process and keep your customers informed. 

*Requests will be reviewed before a refund is issued. 

Find answers to your USPS questions in our blog – Shipping Unboxed: FAQs about USPS.

How does shipping insurance help with damaged packages?

Shipping carriers can try their best to protect the packages in their care, but accidents are still unavoidable while your shipments are in transit. This makes it impossible to know about broken and/or damaged items before they arrive to your customers. Tracking down what ultimately caused the damage to your package is a difficult task, but you’re the one customers will reach out to for help. The good news is, you used a service with included insurance and/or bought additional insurance, so you’re covered. Just in case you don’t know what we’re talking about, let’s break it down. 

Shipping insurance helps cover broken/damaged items, so you aren’t left paying for a replacement out of your own pocket. If an item arrives damaged, you can file a claim with your carrier of choice* and potentially recoup the cost of replacing the items for a customer. You also get to provide great customer service in a lousy situation and turn their day around (and maybe even get a positive review). That’s why we recommend providing your customers with instructions beforehand on what to do if they receive a damaged or broken package because some carriers even require damages to be reported when your customers sign for the package. 

When an item is delivered with damages, you’ll need to provide proof for your claim. Also, your customers shouldn’t throw away any packaging until a claim has been filed with your carrier of choice, the review of the claim has been completed, and your refund has been processed and received. Keeping your customers informed on how to handle potentially damaged shipments takes one less stressor out of the holiday season and leaves you more time to focus on your favorite holiday traditions and treats. 

*Note: UPS One Balance claims will be filed through ShippingEasy

Learn more about filing claims in How to File an Insurance Claim with USPS, UPS, and FedEx!

Why are packages lost?

One of the worst things during the holiday season is telling your customer their package is lost. A package can be lost as the result of several things, including: 

Don’t be afraid to confirm customer addresses for orders going to apartments, duplexes, or other shared housing to avoid any mixups in delivery. Also, include tips for your customers in holiday email campaigns such as bringing in their packages as soon as they’re delivered if possible. Some of the contributors to lost packages can’t be avoided, so it’s worth doing a little extra work to avoid the ones you can. 

How do you keep your holiday customers coming back? Find out in our blog.

How does insurance work with international shipments?

The holiday season might be the time to expand to international shipping! That said, international shipping does come with additional steps to your shipping process, especially with VAT and IOSS guidelines. Some carriers also apply limits on what insurance claims can be filed for if you find yourself with lost packages. We’ve included some of the most commonly used international shipping options for USPS below as well as their insurance options. 

Left Image Source: USPS

How does ShippingEasy help?

Mistakes can happen if your current shipping software is struggling to keep up with your order volume or if you manually process orders. One mistyped or wrongly copied/pasted shipping label or tracking number can end up turning a customer from holly and jolly to a Grinch, and rightfully so. Two gifts of ShippingEasy are our address verification feature and our confirmation emails. 

ShippingEasy uses the USPS address verification and the Melissa Data Global Address Check tools to help validate your domestic and international shipments, respectively. If your address can’t be verified, you have the option to update the address using one of our suggestions. You can even set up automated address verifications for your stores. 

This is an example of how invalid addresses appear in ShippingEasy. 

We also make customized confirmation emails available to our users for all eligible stores. These emails are sent to your customers when their orders are shipped, delivered, and if a return is needed. Confirmation emails are automatically sent to your customers when enabled, so you don’t have to worry about manually adding tracking numbers to your emails and can check accurate tracking numbers off your list instead of checking them twice. 


The scariest thing about your holiday season should be running out of eggnog, not shipping insurance. Using carrier options with included insurance, knowing everything that goes into filing a claim, and how to prevent shipping insurance where you can all help to alleviate stress for both you and your customers. ShippingEasy also gives users the options for automatic address validation and confirmation emails, so you can reduce the likelihood of your shipments being sent to the wrong address or customers receiving the wrong tracking number. Leave the scary elements to Halloween, and keep your winter holiday season warm and fuzzy. 

Light up your holiday shipping with a 30-day free trial!
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Baillee Perkins

Baillee Perkins is a writer of shipping by day and pop culture by night, so her Google search history is an actual nightmare.

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