Package Insurance: Managing Shipping Risk in the Bookselling Business
- By Renee Roberts
Single item insurance rates from U-pic. Lower group rates available.
by Renee Magriel Roberts
I've never been overly fond of the insurance business. Insurance is an ethereal, intangible commodity that frequently appears more connected to a state of mind than a real product. The insurance transaction is essentially a two-part gamble: the insurance company is gambling that collectively it will reap profits despite the certainty that bad events happen; you are gambling that if something bad happens you will have paid less into the insurance "product" than the loss that occurs. I know from the crazy profits made by insurance companies that their bet is better than mine, and yet I buy insurance that is mandated (like car and house insurance), essential (like health insurance) and optional (like package insurance). Despite my admitted anti-insurance bias, I find package insurance extremely useful in our bookselling enterprise.
Now, not every bookseller insures her shipments. I've run into many who do not insure parcels at all; their shipping is at the customer's risk. Some engage in what I would call "poor man's insurance"; they feel that shipping with a proof of putting something in the post office mail stream covers them (for example, saving a receipt for postage, using Delivery Confirmation, or getting the post office to date-stamp a copy of the manifest) in the sense that they are no longer responsible for the shipment if the customer claims it is lost.
The problem with this methodology is that it puts the transit risk for the value of purchase entirely on the customer - a burden which the customer may in fact be shouldering unknowingly if he hasn't read the fine print. And, there is an added assumption that if a customer claims she hasn't received a package it is either somebody else's fault (e.g. the postal system, which will take no ultimate fiscal responsibility for uninsured merchandise) or the customer is simply being dishonest.
We know that this ultimately does not work if the customer has purchased through a site like Amazon, which will essentially force the bookseller to make good unless tracking is used, or through a credit card which will refund the customer and take the funds directly from your bank account. Moreover, fighting with the customer is a losing proposition. The ill-will created is generally a major negative in future sales.
The problem is only exacerbated by overseas shipping. Since you are dealing with at least two postal systems, packages are often delayed and may occasionally be lost. I feel like I should visit my local house of worship, for example, whenever we post something to Italy, a country whose employees not only frequently strike but have been known to burn piles of letters and packages to demonstrate their dissatisfaction. Since overseas shipping appears to be more risky than domestic shipping, and is certainly more expensive, sellers may be very uncomfortable providing services to overseas customers. Moreover, even if one wants to purchase insurance from the United States post office, this is not available for many types of shipments, and it is expensive.
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Package Insurance: Managing Shipping Risk in the Bookselling Business
- By Renee Roberts
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I don't believe in an insurance panacea for all of these issues, but many of them have been solved by the excellent package insurance policy which our company purchases. For the last few years I've been a customer of U-PIC Insurance Services in Agoura Hills, CA (www.u-pic.com). U-PIC is a privately held corporation which has been licensed in California for 16 years, with zero complaints to the California insurance licensing board. Like every other insurance customer, our business is "rated" by them, and because we have had virtually no claims, we have a very economical flat-rate policy which insures not only our outgoing packages, but also, incredibly, incoming shipments, and third-party drop-shipments. Booksellers can insure any method of shipping, including m-bags (volume discount mail), APOs (books to the Armed Forces), and Global Priority and Express. My shipments are not only insured through the post office, but also if I ship through other carriers, such as FedEx, UPS, and DHL.
No matter what site I sell through, as long as I follow some basic guidelines, all of the books coming to and going from my company are insured. U-PIC is also incredibly flexible and will insure just single packages through their website and ordinarily bills based upon the dollar volume of packages shipped.
Here is a typical situation in which having this insurance is extremely useful. I recently shipped a set of The Greville Memoirs to a customer in the U.K. Although we paid for Air Mail, the books have not yet arrived within a reasonable time frame. We suspect that they are not lost, but like many other m-bag air mail shipments they have gone by boat instead of by plane. But, the question is, how does one deal with the customer who has paid for, but not received his books?
Because the shipment is insured, I am not worried that I am dealing with a dishonest customer. I'm quite sure the books are probably delayed, and possibly lost. After discussing the situation with the customer and at least a month had gone by, I asked him to fax us a signed statement with the pertinent information saying he had not received the books. I then filed a lost shipment report and request for tracking with the post office. At that point, as soon as the report with the post office is filed, I submitted all the paperwork with a claim to U-PIC.
Claims with U-PIC are handled expeditiously and the customer is refunded his money. If, and when the books arrive, (and sometimes they have, before the claim was completed) we cancel the claim. If the books never arrive, we have not been hurt financially; we are repaid and so is the customer.
The bottom line is that through the entire process I am able to put the needs of my customer first and never, ever, have to tell him that he in fact was ordering books "at his own risk", or eat the loss. Even if a package is stolen after its Delivery Confirmation barcode is swiped by the delivering letter carrier, U-PIC will cover the shipment. They can, of course, create reports that show them if they've got a particular recurring problem with any customer, dealer, or carrier.
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Package Insurance: Managing Shipping Risk in the Bookselling Business
- By Renee Roberts
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Another advantage to working with this company is that they are integrated with Endicia (www.endicia.com), the company that provides us with the software and Web-based services to stamp our own postal packages. Reporting to U-PIC is always available through the postage log that is automatically created.
I recently interviewed Candi Booth, Vice President (who was originally my sales rep when we first started using U-PIC). She filled me in on some other aspects of the package service of which I was unaware. Package insurance is ideal not only for booksellers, but eBay sellers who are shipping virtually any commodity, whether it is books, art, jewelry, or auto parts. If you are concerned about taking business away from your local post office, not to worry - the postmasters get credit for Endicia/U-PIC-created packages and are encouraged to use U-PIC, a USPS Partner, for ordinary over-the-counter insurance.
For more information, you can contact U-PIC at www.u-pic.com, call toll-free 800-955-4623, or email them at support@u-pic.com. They also have support through online chat on their website.
Package insurance has enabled us to confidently establish a European Union-based company and expand our business overseas, as well as service customers looking for higher-priced rare books. It enables us to provide excellent customer service and is an essential part of our bookselling business.
Renee Magriel Roberts can be reached at renee@roses-books.com
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