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In lugnet.market.theory, Kerry Raymond writes:
>
> > I noticed on anotehr seller's eBay auctions that they charge a 50c "Self
> > insurance" fee on each package, and promise to refund up to $50 if the
> > package is lost.
>
> The possible risk is that the evil buyer receives the parcel but pretends
> they don't. They end up with the set and the $50. I would expect that your
> postal "losses" would increase if you offered self-insurance.
>
> If the Post Office insures the parcel, then they can impose mechanisms to
> confirm delivery. You can't.
>
> Kerry
Actually, the mechanism to insure the parcel and the mechanism to confirm
delivery are different. The USPS even charges seperate fees for each. Its
entirely possible to track (Delivery Confirmation) a package without insuring
it.
<soapbox>
Lets talk about insurance for a second. Insurance is basically a gamble (e.g.
you are placing a bet). The bet is that something might go wrong (but usually
does not). If you only ship one package in a month, then insurance might be a
safe bet (still expensive tho). If you ship larger numbers of packages, then you
might find that 'pooling' that insurance money is a better bet than playing the
game with the 'house' (remember, the house always wins overall).
</soapbox>
Back to the ongoing issue of 'high' insurance costs. Currently, the USPS charges
$0.85 for 'unnumbered' coverage (up to $50) and $1.80 for first tier numbered
($50.01 to $100.00). These two brackets cover most of my shipments. It appears
that some rates are about to increase. The proposed new rate for 'unnumbered'
insurance is $1.35. Pretty steep increase if you ask me. But this rate is for
"retail insurance". The post office breaks pricing into two catagories,
retail and other (sometimes called bulk insurance). The bulk insurance people
get a price break. The unnumbered 'bulk insurance' is currently $0.45.
Futhermore, it appears that people with the right software can generate their
own tracking bar-codes and get *free* tracking. But these are not available
for anyone who wants to ship packages across the 'retail' counter. Also,
Delivery Confirmation is proposed to go from the current $0.35 to $0.40.
Shipping a basic 2-lb P/M package with ins & DC currently costs $4.40. With the
new increases, that will rise to $4.95.
So, to sum up, it appears that 'self-insurance' is looking more like a good
idea. Especially if you ship enough parcels (and have the right software) to
qualify for the *free* tracking.
P.S. The requirements for the 'free tracking' are written up in USPS Pub 91.
I'm reading thru it right now. Part of this is the ability upload a list up
numbers you are shipping via FTP. Anther part is to print accurate bar-codes.
Ray Sanders
#124
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