Shipping Insurance Cost Calculator
Whether insuring is cheaper than self-insuring.
Premium per parcel
$1.20
above expected loss
Insuring costs 6.7× your expected loss. Self-insuring the routine parcels and covering only high-value ones usually wins.
How the Shipping Insurance Cost Calculator works
Insurance is worth buying when the premium is less than the expected loss, or when a single loss would genuinely hurt. Across many low-value parcels, self-insuring almost always wins — the premium includes the insurer's margin, and you are paying it on every parcel to cover the rare one.
Not financial advice. Marketplace fees change, and they vary by country, plan and seller status. Every rate here is an editable default, not a quoted price — check the platform's current fee schedule before you price a product against it. This is not tax or business advice.
Frequently asked questions
How much does shipping insurance cost?
Typically 1-3% of declared value, often with a minimum charge that makes it disproportionately expensive on low-value parcels. Third-party insurers are usually cheaper than carrier-provided cover for the same protection.
Should I insure every parcel?
Compare the premium against your actual loss rate times average value. If 0.3% of parcels are lost at £40 each, expected loss is £0.12 a parcel — insurance at £1.20 is ten times that. Insure high-value items; self-insure the rest.
What does carrier liability cover without insurance?
Most carriers include limited liability, often around £50-100, but claiming requires proof of value and the process is slow. It is a floor rather than real protection, and it rarely covers consequential losses.
What is self-insuring?
Setting aside what you would have spent on premiums to fund replacements yourself. It works when you ship enough volume for losses to be predictable, and it fails if a single loss would be unaffordable.