Shipping insurance protects your cargo against loss, damage, and theft during transit. Cost = 0.5%-2% of cargo value, depending on route, product type, and coverage level. This guide shows how to calculate premiums and decide if insurance is worth it.
What Does Shipping Insurance Cover?
- Total loss (cargo lost at sea or airport)
- Damage in transit (broken, wet, bent)
- Theft
- Delay claims (for perishables)
Insurance Cost Formula
Premium = Cargo Value × Insurance Rate
Example: $10,000 cargo × 1% rate = $100 insurance
Insurance Rates by Route
| China → USA (sea) | 0.5%-1% |
| China → USA (air) | 1%-1.5% |
| China → Europe | 1%-2% |
When to Get Insurance
- Cargo value > $5,000
- Fragile/breakable products
- High-risk routes
- First-time shipment to new customer
Cost Benefit Analysis
$10,000 cargo, 1% insurance = $100 premium. If 1 in 100 shipments is lost, insurance pays for itself. Most shippers have 99%+ safe delivery, so skip insurance for low-value cargo.
