Amazon shipping insurance is a service which provides financial compensation to the customer if the package is misplaced, stolen or broken while shipping.
Every online shopping sites and courier company provide the primary level of insurance to every customer, for example, Amazon provides Amazon product insurance, cargo-shipping insurance and liability insurance to their customers.
Here are different types of shipping insurance and the pros and cons of each:
1) Carrier Insurance: USPS, FedEx, UPS, etc courier companies provide carrier insurance. This is the most basic type of shipping insurance.
Pros of carrier insurance:
You can purchase carrier insurance with the shipping costs.
You may get this service free of cost.
Famous courier companies provide this service.
Cons of carrier insurance:
Claims can take a long time to be processed.
Costly than other services.
Few services may not cover international shipment.
2) 3rd party insurance: You can purchase 3rd party insurance on your behalf from any private company which is not affiliated with the carrier. This insurance ensures your package in the case of loss or damage. You need Amazon shipping insurance to protect your package from unexpected damage or misplacement.
Pros of 3rd party insurance:
Can be purchased with shipping cost or without it.
Less costly than other methods.
Claim processing time is less.
Cons of 3rd party insurance:
Providers are very less.
May charge an extra fee if insurance provider is not from your place.
3) Self-Insurance: Shipper is responsible for the package damage and covers the cost of replacement.
Pros of self-insurance:
Claim processing time is very less than other methods.
You can get insurance at lower rates.
Cons of self-insurance:
Seller may not accept his mistake.
Many insurances claims need to be filled by the seller. Always note down few things like when you notified your seller or when the claim was processed etc. Always try to keep track of your claim. You may read more about shipping insurance from this website.