UPS Declared Value and Insurance: Protecting Your Shipments

Every package you ship carries some risk of loss, damage, or theft during transit. While UPS maintains one of the most reliable delivery networks in the world, incidents do happen. Understanding your coverage options can be the difference between a minor inconvenience and a significant financial loss. This guide explains UPS declared value, additional insurance options, the claims process, and best practices for protecting your shipments.

Understanding UPS Declared Value

What Is Declared Value?

Declared value is the maximum amount UPS will reimburse you if a package is lost, damaged, or has contents missing during transit. It's important to note that declared value is not insurance in the traditional sense; rather, it sets the limit of UPS's liability. For every domestic shipment, UPS automatically includes $100 of declared value coverage at no additional cost. This means if your package is worth $100 or less and gets lost or damaged, UPS will reimburse you up to $100.

Key Distinction: Declared Value vs Insurance

UPS declared value and third-party shipping insurance serve similar purposes but differ significantly in their scope and provider. Declared value is provided directly by UPS and includes a base coverage of $100 per package. If you need coverage beyond this amount, you can pay an additional fee per $100 of declared value up to a maximum of $50,000. Third-party shipping insurance, on the other hand, is offered by independent companies like Shipsurance and InsureShip. It typically provides broader coverage options, such as protection against theft and porch piracy, and can cover high-value shipments exceeding $100,000.

UPS Declared Value Rate Schedule (2026)

To increase your declared value above the included $100, you pay a fee based on the declared value range. For example, if your package's value is between $300.01 and $500.00, you would pay $3.45 per additional $100. As the value increases, so does the fee, with a package valued between $25,000.01 and $50,000.00 costing $11.25 per additional $100.

Declared Value Cost Examples

To help you understand the cost implications, here are some examples: For a package valued at $250, you would pay $5.18 for declared value coverage, providing you with a total protection of $250. A package worth $1,000 would incur a fee of $36.55, and for a $5,000 package, the fee would be $146.95.

Items with Limited or No Coverage

UPS has restrictions on declared value coverage for certain items. Before declaring a high value, it's crucial to check if your item qualifies.

Items with Maximum $500 Declared Value

Certain categories, like artwork, antiques, and musical instruments, have a maximum declared value of $500 unless specific shipping options are used, such as UPS Art Shipping for artwork. Other items like furs and costume jewelry also fall under this limited coverage.

Items Excluded from Declared Value Coverage

Some items are completely excluded from declared value coverage due to their high risk or inability to verify their value. These include cash, precious metals, negotiable instruments, precious stones, firearms, hazardous materials, perishable goods, and tobacco products. For these items, third-party shipping insurance is necessary to ensure protection.

Third-Party Shipping Insurance Options

When UPS declared value is insufficient or unavailable, third-party shipping insurance becomes an essential option. Providers like Shipsurance, InsureShip, Parcel Insurance Plan, and U-PIC offer various coverage ranges and rates, often at a lower cost than UPS declared value fees. For instance, third-party insurance can be 65-75% cheaper for packages valued over $500. However, it's crucial to understand that the claims process might differ and you would be dealing with a separate company.

Filing a UPS Claim

If a package is lost, damaged, or has missing contents, here's how to file a claim:

Step 1: Determine Claim Eligibility

Claims can be filed based on the type of issue, such as visible damage, missing contents, or loss. It’s important to file within specified time limits, which are usually 60 days from delivery for damage or missing contents, and after 24 hours (for express) or 7 days (for ground) past the scheduled delivery date for loss.

Step 2: Gather Required Documentation

Before starting your claim, collect necessary documents like the tracking number, proof of value, photos of damage, original packaging, proof of shipment, and a description of contents. These documents are crucial for processing your claim efficiently.

Step 3: File the Claim

You can file a claim online at ups.com/claims or by calling UPS directly. The process involves selecting your claim type, entering the tracking number, uploading supporting documentation, and submitting your payment information for reimbursement.

Step 4: Claim Investigation

After filing, UPS reviews your claim and may request additional information or schedule an inspection. The investigation can take 10 to 30 days, and if the claim is approved, payment is issued within 30 to 60 days.

Step 5: Receiving Payment

Once approved, claims can be paid via check, direct deposit, or credited to your UPS account, depending on your preference.

Strategies for Minimizing Loss and Damage

Proper packaging is your first line of defense and is critical for claim approval. UPS may deny claims if packaging is deemed insufficient.

Packaging Best Practices

Use strong, new boxes, especially for items over 10 lbs, and ensure a minimum of 2 inches of cushioning material on all sides. Avoid empty space inside the box to prevent items from shifting. Seal boxes with at least 2-inch wide pressure-sensitive tape, and wrap fragile items individually with protective materials.

Labeling Best Practices

Ensure clear address labels, remove old labels, and include an internal address slip as a backup. Using "Fragile" and "This Side Up" labels can alert handlers, although they don't guarantee careful handling.

Choosing the Right Declared Value

For items under $100, the default coverage is sufficient. For values between $100 and $500, UPS declared value is convenient. For more expensive shipments, third-party insurance offers cost savings, and for high-value items over $25,000, using specialized shipping services like UPS High Value is advisable.

UPS High Value Shipping Program

For packages valued over $5,000, the UPS High Value shipping program offers enhanced security, including a higher declared value limit, enhanced chain of custody, dedicated handling, and expedited claim investigation. To enroll, contact your UPS account representative and ensure you meet the eligibility requirements.

International Shipment Considerations

International shipments involve additional complexities, such as customs valuation, currency differences, and more stringent documentation requirements. Be aware that restricted items may differ and delivery confirmation may be limited in some countries.

Frequently Asked Questions

Does UPS declared value cover theft after delivery?

No, UPS declared value only covers incidents while the package is in UPS's possession. Once delivered, liability ends. For theft after delivery, consider third-party insurance or delivery options like signature required.

Can I declare a value higher than the actual item cost?

No, UPS will only reimburse up to the actual value of the item. Declaring a higher value will result in overpaying for unnecessary coverage.

How do I prove the value of my shipment for a claim?

UPS accepts several forms of proof of value, including purchase invoices, sales invoices, MSRP, professional appraisals, replacement cost quotes, and marketplace listing prices. Keep digital records of all relevant documents.

Is declared value the same as cargo insurance?

No, declared value limits UPS's liability, while cargo insurance is a separate policy covering broader risks. With declared value, you must prove UPS was at fault, whereas insurance policies typically cover all risks unless excluded.

What is the claim denial rate for UPS?

Although UPS does not publish official denial rates, it's estimated that 15-25% of claims are initially denied or reduced due to reasons like insufficient packaging, excluded items, missing documentation, or late filing. Following guidelines and documentation requirements improves claim approval rates.

Protecting your shipments is essential for safeguarding your business. Combining UPS's included $100 declared value for low-value items with third-party shipping insurance for high-value shipments provides a balanced approach to coverage and cost. Investing in proper packaging and thorough documentation ensures smooth claims processing when incidents occur.