Shipsurance is a SCAM!

Shopify Discussion

Topic summary

A merchant reports that Shipsurance denied their claim for a high-value item damaged by UPS, citing violations of terms not clearly communicated upfront. The merchant criticizes both Shipsurance and Shopify for not making requirements explicit during the shipping process.

Key requirements cited for valid claims:

  • Must use approved carriers (UPS, etc.)
  • Signature required
  • No external markings indicating package contents
  • Must include commercial invoice inside

The merchant argues Shopify should either integrate only reliable options or build automatic warnings/restrictions into the system to prevent violations. They characterize Shipsurance as a scam due to hidden terms revealed only during claims.

Alternative suggested: One commenter recommends switching to shipping protection apps (like Captain Shipping Protection) where customers pay a small fee that goes directly to the merchant, allowing immediate replacements without claim approval delays.

Counterpoint: Another user reports no issues with Shipsurance, noting that filing with both UPS and Shipsurance simultaneously invalidates claims.

The discussion remains unresolved regarding whether Shipsurance’s practices are deceptive or if merchants simply need better awareness of terms.

Summarized with AI on October 24. AI used: claude-sonnet-4-5-20250929.
1

I’d just like to make everyone here aware of this: Shipsurance is a SCAM! I can’t believe Shopify would allow them to scam us as their customers.

I shipped a high value item and decided to use Shipsurance. Fair enough: UPS basically drove on top of the box with the truck, and only covered $100.00. Submitted a claim through Shipsurance and the declined it immediately citing a violation of their terms.

If Shopify knows they will only honor the insurance if very specific conditions are met: why not set up the system automatically so that we select the options that meet those requirements?

You need to ship UPS or other approved shippers,

You need a signature,

The items CANNOT have markings outside indicating what it is,

It MUST contain a COMMERCIAL INVOICE inside…

Amongst other things.

  1. Shopify should only include options that benefit us,
  2. If they have terms dug deep beneath their T&C’s, then program the system to make it IMPOSSIBLE to ship without meeting those terms, or at least WARN US!!!

Very disappointed in Shopify and Shipsurance is simply a SCAM.

I hope this helps someone…

2

Hi @rsolorzano

A lot of merchants run into the same issue with Shipsurance. They only make you aware of all those hidden terms and conditions when you actually go to file a claim, which feels super unfair. Honestly, Shopify should be doing more to protect merchants here, this integrated insurance option is so unreliable.

One alternative you might consider is using a shipping protection app instead of relying solely on carrier or third-party insurance. For example, Captain Shipping Protection let you add a small widget on your cart or checkout page where customers can opt in to pay a protection fee. Like the screenshot shows below :backhand_index_pointing_down:

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c7eb7aada6466fb700edf3c0bcca66c82844×1540 172 KB

The nice part is that the fee goes directly to you, so if a package ever does get lost or damaged, you can issue a replacement or refund right away without waiting weeks for a claim to (maybe) be approved. And since these cases are actually pretty rare, most of the time that fee just becomes extra revenue for your store.

It can give you more control over your orders and avoids getting stuck in the fine-print battles with an insurance provider.

Hope this helps!

3

We have never had any issues with them, if you filed a claim directly with UPS then Shipsurance is not going to pay. You cannot double dip.