A lost or perished delivery is always a problem for both seller and customer, and the question of this post arises: Should I get insurance for deliveries? When shipping products to your customers, it isn’t just the value of the merchandise that causes issues but also problems of late deliveries or lost orders that never arrive. These issues can cause discrepancies between seller and customer over who should take responsibility for damaged or undelivered goods, and is something any brand selling online should determine and state clearly to the customer beforehand.
Reasons Why You Should Get Insurance for Deliveries:
You’re shipping a valuable product
If the product you are shipping is valuable, delicate or perishable, a delivery insurance should be considered. Most deliveries come with a basic insurance that is mandatory, however this basic insurance only covers the bare minimum, and merchandise of greater value won’t be covered. Luxury goods for instance require a larger investment on behalf of the customer and should therefore come with an additional insurance so as to avoid customer service issues later down the line.
You value your customers and don’t want to lose them
Customer loyalty is crucial for a successful business and one delivery gone wrong can translate to negative reviews and a loss of customers in the future. Transportation companies are limited to the amount they can insure, depending on the company, which is one reason why many sellers hire additional insurance to cover the total value of the merchandise sold, therefore covering any possible problems that might arise.
Types of insurance and your company policy
Some companies calculate shipping costs based on weight, whereas other calculate based on value of the product. This will determine what kind of insurance you decide to get and how much it will cover. In the case of BLOOMBEES SHIPPING, for example, shipping costs are calculated based on weight, therefore the minimum, basic insurance covers a maximum of 5.29€ per kilo, independently of the value of merchandise. There are also various types of insurance. Industrial insurance, for example, covers a plus in addition to the transportation cost and covers up to a maximum amount. Bloombees offers this option to its clients, insuring goods up to 600€ for deliveries that include this additional insurance. Other options include, for example, an insurance based on the merchandise where the insurance premium is a percentage of the declared value of the goods, typically around 2%. All of these modalities, the type of goods you are delivering, and your policy as a company should be taken into account when determining whether or not to get insurance for deliveries.
To sum up this post and answer our original question, companies should always opt in on insurance for deliveries when the merchandise has a high value for the recipient, or when the company values retaining that customer’s loyalty and positive feedback. If shipping conditions can be negotiated directly with the customer, who covers the insurance charges should be decided upon directly with the customer. Otherwise, the seller should assess whether or not to include any insurance charges into the final delivery cost.