USPS Insurance and Filing a Claim on Broken Merchandise

If you are currently unemployed, selling your old things on an auction site is a great way to earn extra cash. However, one of the risks of selling merchandise and then shipping it through the United States Postal Service (USPS) is the possibility of things getting broken somewhere along the way.

This guide will help explain the importance of proper packaging; how to insure your merchandise; how to file an insurance claim; and to stack your odds in favor of having the USPS honor an insurance claim for merchandise that has broken through no fault of your own.

Proper packing is how to increase the odds of the USPS honoring an insurance claim for broken merchandise.

When shipping breakable or valuable items through the mail, it's important to note that the USPS will NOT honor any insurance claim on items that weren't packaged properly. An excellent "mental trick" that always worked for me was to visualize how the package will fare being tossed eight feet across the room, and to package it so damage won't occur. This publication by the FedEx people " Your Guide to Proper Packaging" is also a fantastic guide and should be read by anyone trying to sell merchandise through the US mail system or through a private carrier.

Always insure your merchandise

When I sold merchandise on eBay, insurance was something that I automatically included in the shipping & handling costs. Even though I knew my parcels where packaged properly, there was always the risk of theft, loss, accidental damage or some other unforeseen problem that I wasn't willing to risk. Insuring merchandise is done through the post office or through the USPS on-line store. The shipper (that's you) will fill out a small form declaring the value of the merchandise and pay a small insurance premium based on the value. Both mailing and insurance receipts must be kept until the package is received by the addressee.

Even though you might claim the parcel is worth $1000, it's important to understand that the insurance will only cover what can be backed up by an invoice. For eBay sellers, the eBay invoice is your proof. If you are are a private party mailing an item across the country, you must be able to provide some evidence of value such as an receipt or an appraisal. Without these documents, the USPS will NOT honor an insurance claim.

How to file an insurance claim for damaged merchandise

So what to do if the parcel arrives broken?

1. Instruct the recipient of the package to keep all of the original packaging including the box, the padding, tape and of course the item even if it's smashed to dust.

2. Make a copy of your Post Office receipt showing the shipping information AND the insurance form, for your records. Mail the originals to your customer along with a copy of the invoice.

3. Once the paperwork is received, your customer must take the broken item to the post office along with all the packaging, the insurance slip, the USPS receipts, and invoice proving value. That's all there's to it! To speed up the process for your customer, suggest that he visit the Main Office of the postal service in his town, since this is where insurance claims are processed. The half dozen times or so when my merchandise was damaged through no fault of my own, the post office not only honored the insurance claim, but often refunded my customer's money right on the spot.

Having an insurance claim honored through the United States Postal Service is really not that big of a deal. The key to stacking the odds of in your favor for a claims settlement through the USPS is always proper packaging, a sales receipt or appraisal to prove value, and the original insurance form and shipping invoice.