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 M¢25  Funded By Mahalo ? |  June 11, 2009 06:19 PM

How is it legal that UPS can charge for "insurance" on packages. Why isn't it their responsibility if it's in their system?

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June 11, 2009 08:24 PM
How is it illegal? A delivery fee is for delivery (sometimes pickup) and tracking service. If the carrier fails in the delivery, you will be refunded the fee.

Every carrier is the same. UPS, FedEx, US Postal Service, LTL carriers.

There is no mathematical formula that can fairly "average" a value onto every package. Besides, I certainly don't want to pay higher rates on my box of books or shoes just so you can ship a diamond ring for 8 bucks. Not my problem.

Insurance is not required by the carrier. If you have something of value, you must weigh the risk against your paying for full replacement or covering shipment under your own insurance policy. Many businesses use their own umbrellas, and ship via common carriers with minimum or zero value claimed on the package.

If you can't afford to replace the item yourself, then buy insurance from the carrier, buy your own insurance (or look up your existing policy coverage). Or, deliver it yourself.

It's called risk. Noone will assume your risk for free. It's completely illogical and will quickly bankrupt a business.

Most complaints come from people who ship with no insurance, have no insurance of their own, and cannot afford to replace the item being shipped.

Some do not read/understand standard contract terms. They ignore or skip them altogether. They gambled, and lost.

Take a large retailer like Amazon.com. They don't pay UPS insurance. They have their own budget to pay for merchandise stolen/lost in transit. Large losses would be claimed under their own insurance. So, they figure in a penny or two into every item to cover the losses. In turn, they get cheaper shipping rates.

The consumer will never notice an extra penny in price. It is far cheaper than paying $1-10 in insurance with every shipment.


Tags: insurance, shipping

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June 11, 2009 06:49 PM | view on twitter
The answer might be as simple as packages not being their problem. Why should the government have to pay to insure something they care nothing about? If you want to make sure it gets there safely, then they believe you should have to pay extra for that security. They can't control when delivery accidents happen and don't want to spend the time fixing it if they don't have to.

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