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Subject: 
Re: "Self Insurance" on packages
Newsgroups: 
lugnet.market.theory, lugnet.market.shipping
Date: 
Mon, 23 Oct 2000 21:23:38 GMT
Viewed: 
1451 times
  
Ray Sanders wrote:

In lugnet.market.theory, Kevin Wilson 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.

This seems like an interesting idea since most of my packages go out at
the "Small Packet" rate to teh US and other coutries, and it's not
possible to buy insurance on them. I think the 50c is a bit high and teh
$50 a bit low considering I've sent out about 1500 packages in teh last
18 months and just 2 have disappeared, but I'm considering doing this.
Anyone have opinions on it?

I think it's a reasonable idea. As Ray mentions, that's a cheaper rate
than the USPS charges. Of course, my feeling is that a buisiness would
score points for eating the cost out of their proffits. As a buyer, I've
sort of felt that I really buy enough that I should self insure (and in
fact really do, it's just that I recently almost felt stuck and lost
sight of the situation - of course it's also natural to feel you've been
cheated if you never receive something you paid for even if you didn't
buy insurance). My initial foray into buying and trading using the
Internet to contact trade partners was with TSR's Dragon Dice. When I
first started trading, I was being incredibly carefull. Then I started
to realize most of the time I was really dealing with less than $10
worth of stuff. There just plain was no reason to worry. As a result, I
even started trading overseas.

With all of the trading and buying I'll try and list EVERY time I've had
a problem other than mis-representation of goods:

- One Paradisa set, never arrived, seller never responded, other buyers
failed to get their goods also, assumption is that the seller took the
money and ran. Insurance wouldn't have helped

- One trade delayed for months, trade partner hadn't mailed it,
insurance wouldn't have helped

- One set may or may not have been missing pieces (set wasn't advertised
as complete). Set stuck in box with no inner packaging at all. Box had a
hole in it. Insurance probably wouldn't have paid since the packing job
really was insufficient (note that they do have a disclaimer about
packing)

- One parts lot arrived in torn padded mailer, one rareish piece and a
bunch of common pieces missing. Insurance might have helped, but the
packing was not really passable. The pieces were in a light weight
resealable plastic bag inside the padded mailer. Packaging was probably
at least in part torn by the parts. Seller replaced the common parts,
and I think has been a little more carefull in packing.

- One package stuck in Post Office timeloop for 2 weeks. Insurance would
have helped if package had turned out lost instead of stuck, but the
Post Office requires a 30 day wait before they are willing to assume
loss.

- One somewhat bent baseplate (and maybe a little crack). Insurance
probably wouldn't have helped, Box was just barely big enough.

- A few crushed boxes from KB Kids, S@H, etc. No loss other than the
cosmetic loss of the set box. Worst instance was a small Scala set from
S@H which was almost folded in half (I really should have taken a
picture - it was quite amazing).

- Perhaps a few other parts damaged, but probably due to poor packing.

So, all told, out of thousands of dollars (or tens of thousands...) in
purchases and trades, I've lost less than $50. I've NEVER had a package
go missing. I've paid considerably more than that in insurance fees, and
at best I would have collected $10-20. On the other hand, I NEVER got
anything from the Post Office on the whereabouts of the Certified Letter
with return card that I sent to the seller who burned me. They did
eventually manage to get me a copy of the cashed money order, but I
think I sent two or three requests for the info on the Certified Letter.
I felt pretty bad for the local Post Office employee who was handling
this for me (wasn't his problem, I think he had to CALL the other
Postmaster to get them to respond to the request for the money order
info).

What's interesting is that I've NEVER had a problem with an
international package (and I've done a fair bit of overseas buisiness as
Jason Briscoe, Larry Pieniazek, and a few others [oh, Martin Legault for
one if you want to include Canada] can attest...). Oops, one more
"problem":

- A package from Canada mailed to the wrong person, package was
eventually mailed to me (though the person who received it by accident
did manage to twist my arm into splitting an eBay lot with them...).
Seller paid for the extra shipping. Insurance wouldn't have helped.

Seriously, this is why the USPS makes money. Its like the phone company, they
make very little profit on 'basic service', they make large margins on the
'added services' (like call waiting for example). Personally, I think the USPS
should be offering basic coverage ($50) on Priority Mail packages. But, as long
as people keep coughing it up, why bother. I even wonder if the blue insurance
tracking sticker on a package is just an invitation for pilferage.

Definitely add-ons (service or otherwise) are a good market, at least in
some areas (though I've seen some analysis from the games industry [both
paper and computer] that indicate that game add-ons are not cash cows).
I doubt the insurance sticker has that much of an effect on pilferage.
The class of goods which invite pilferage is pretty small. An insider is
at a great risk of discovery if they take very much (which probably
relegates some pilferage to the class of goods people won't be likely to
complain about - I wonder how many x-rated magazines go missing as
compared to say National Geographic?), and certainly is more likely to
be caught if they pilfer goods which are tracked in any way ("gee, the
insurance claims from Podunk You Post Office are 50% higher than any
other Post Office, I wonder what's going on...").

--
Frank Filz

-----------------------------
Work: mailto:ffilz@us.ibm.com (business only please)
Home: mailto:ffilz@mindspring.com



Message has 1 Reply:
  Re: "Self Insurance" on packages
 
In lugnet.market.theory, Frank Filz writes: <major snippage> (...) Check this out... (URL) (and I can't get the url to post without something breaking the line) scroll down and read that part titled 'Insurance'. Looks like the USPS wants/is- about (...) (24 years ago, 24-Oct-00, to lugnet.market.theory, lugnet.market.shipping)

Message is in Reply To:
  Re: "Self Insurance" on packages
 
(...) In lugnet.market.theory, Kevin Wilson writes: (...) (1) The USPS gets 0.85 for the same coverage (2) If your loss rate is 2/1500, then expect one package in 750 to get lost (although I think that might be a bit high, one in 400 ?) (3) If you (...) (24 years ago, 23-Oct-00, to lugnet.market.theory, lugnet.market.shipping)

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