Parcel Insurance Explained
Every courier includes some level of free cover — but it varies wildly. This guide breaks down what’s included, when to upgrade, and how to actually get paid if something goes wrong.
Quick Price Check
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Default Insurance by Courier
| Courier | Standard Cover | Max Extra Cover | Extra Cost (approx.) |
|---|---|---|---|
| Royal Mail (1st/2nd) | £20 | £500 | From £1.50 |
| Royal Mail Special Delivery | £500 | £2,500 | Included in price tiers |
| DPD | £100 | £5,000 | From £3.00 |
| Evri | £20 | £500 | From £0.99 |
| Yodel | £50 | £2,500 | Varies by service |
| ParcelForce | £100 | £5,000 | From £4.50 |
Figures as of 2026. Always confirm with the courier before booking.
When Should You Buy Extra Insurance?
If the value of the contents exceeds the standard cover, extra insurance is almost always worth it. The cost is typically 1–3% of the declared value. Consider upgrading when:
- The item is worth more than the courier’s default cover
- It’s a one-of-a-kind or irreplaceable item
- You’re sending electronics, jewellery or artwork
- The recipient is a customer and a refund would cost you more than the premium
How to Make a Claim: Step by Step
- Report it quickly. Most couriers require claims within 14–30 days of the delivery date (or expected delivery date if lost).
- Gather evidence. Photos of damage, the outer packaging, the shipping label, and the item itself. For lost parcels, keep your tracking reference and proof of posting.
- Submit online. Every major courier has an online claims portal. Fill it in with your tracking number, description of the issue and evidence uploads.
- Wait for investigation. Couriers typically take 5–15 working days to investigate.
- Receive payment. If approved, refunds are usually paid via the original payment method or bank transfer.
What Voids Your Insurance
Couriers will reject your claim if:
- The item was inadequately packaged (no padding, wrong box size)
- You sent a prohibited item (batteries, liquids, etc.)
- The declared value doesn’t match the actual value
- You can’t provide proof of value (receipt, invoice, bank statement)
- The claim is submitted outside the time window
Third-Party Parcel Insurance
Companies like Parcel2Go Insurance, Shipsurance and XCover offer standalone policies. This can be useful if:
- Your courier’s maximum cover isn’t high enough
- You want a single policy across multiple couriers
- You ship high volumes and want bulk-rate premiums
Premiums typically start around 1% of declared value for standard goods.
Is Extra Insurance Worth It? A Quick Framework
Ask yourself three questions:
- What’s the item worth? If it’s under the default cover, you probably don’t need extra.
- Can you replace it? Unique or handmade items can’t be replaced at any price — insure them.
- What’s the premium vs. the risk? Paying £3 to insure a £300 item is a no-brainer. The loss probability is low but the downside is high.
For most senders: if the item is worth more than £50, insurance is worth the peace of mind.