Merchants report that Shopify’s advertised $100 shipping insurance coverage for lost packages is not being honored, particularly for USPS First Class International shipments.
Core Issue:
USPS First Class International packages lack tracking and cannot be claimed with USPS unless registered mail service is added
The “File claim” option either doesn’t appear in Shopify admin or shows “this claim is not eligible” when clicked
USPS customer service reportedly states they don’t honor claims on labels purchased through Shopify
Support Experience:
Multiple merchants describe receiving scripted responses from support representatives
Representatives allegedly direct merchants to file claims with USPS despite this being impossible for unregistered First Class packages
Escalation requests are reportedly ignored or delayed
Financial Impact:
Merchants are losing both merchandise and sales while having to refund customers
One example: package stuck in Mexico led to PayPal dispute; another stuck in Arizona since January 24th
Workarounds Suggested:
Require customers to purchase third-party insurance (Shipsurance with Assurant)
Use USPS registered mail service for international shipments
Consider self-funded shipping protection apps (ShipAid, Captain Shipping Protection) that allow merchants to collect protection fees and handle claims directly
Status: Issue remains unresolved, with reports spanning over two years.
Summarized with AI on October 25.
AI used: claude-sonnet-4-5-20250929.
So if you ship internationally at all using USPS first class. MAKE SURE to require customers to buy insurance through Shipsurance with Assurant insurance or pay for registered mail service because Shopify is lying when they say any package will be covered up to $100.
I had a package shipped that was sitting in Mexico without movement for quite some time which the customer started a claim with PayPal over and I contacted Shopify because there was no option on the order to submit a claim and the customer dis-service rep continually ignored me and kept feeding me their little pre-scripted responses and bad advice that I kept shooting down like skeet using screen shots to refute their directions, proving them wrong an inept at every turn, but they kept maintaining that I needed to submit an inquiry with USPS. This absolutely is not the case. Unless you ship priority international or above, or add registered mail service, it CANNOT be traced or claimed with USPS at all under any circumstance. I got the run around over and over again from this useless rep who refused to accept any of my knowledge and experience with this (as I have dealt with attempts to track enumerable first class packages with no luck in person, online, on the phone with USPS, nothing.).
I asked the rep no fewer than 5 times to give me over to someone else after they gave me incorrect advice at EVERY TURN but they literally ignored the request until the very end after having tried a dozen times to pass the buck to USPS and only claimed that there were no supervisors available and showing me screen shots on how to get to chat support (like I wasn’t already in there with them, how do you figure that works genius?).
Shopify needs to stop outsourcing to people who only read from scripts and they need to adjust their insurance claim requirements if they are just going to pass the buck to a dead end. My package should be covered for up to $100 and they are refusing to honor it despite the fact that USPS does not cover unregistered first class. I hate Shopify more and more every day.
Thank you for sharing those details here for other merchants to hear about your experience with our support and your concerns about getting your shipping insurance honored. From what you explained, I believe I can provide clear next steps on how to submit an insurance claim with this order.
Generally speaking, yes USPS shipping insurance claims do need to be opened with USPS directly. In cases where shipping insurance is provided by Shopify on eligible orders that claim actually needs to be submitted with our insurance provider Shipsurance. You can read more about this option and how to take advantage of it in our Help Center here:
Click the number of the order that you want to submit an insurance claim for.
Click the … button, and then click File claim.
In the Claim details section, select the following information:
claim type
discovery date of your damaged or lost package
claim reason
In the Claim amount section, enter the amount of money that you want to claim. You can’t claim more than the amount of coverage that you have paid for.
In Payout details, choose how you want to receive your insurance payout from Shipsurance, and then add your contact or address details depending on your payout type.
In the Contact information section, enter your email address. This is the email Shipsurance uses to contact you if they need additional information about your claim.
Select I have read and understand the disclaimer above, and then click File claim.
After you submit a claim, you receive an email with the claim ID and a link to access the Shipsurance insurance portal. You can click the link to check the status of your claim. You can also check the status by clicking on the claim information on the order.
I sincerely apologize if this information was not shared with you properly when you initially reached out to our live chat support for help with this. If you need any additional support with this claim please don’t hesitate to reach out to our support team and share this forum post as a reference for the steps you are taking.
If I can assist with any other questions through our community forums, please let me know.
So you apparently didn’t read my post very closely (big shocker /s) because I very distinctly stated “I contacted Shopify because there was no option on the order to submit a claim” so once again if you people can’t be of actual help, stop trying because these cookie cutter responses with solutions I have TOLD YOU I already tried is a waste of my time. This is such an ironic response because you are illustrating exactly what I’m so frustrated with by your own response.
I appreciate you clarifying that @Travnape . Your frustration is completely understandable. Since I am not able to escalate this issue myself I would ask that you please contact our live support once again about this. To assist and ensure you get the correct support right away and you don’t have to repeat the information you have already shared, please reference this ticket number for your agent: 36113647.
This way your agent can quickly jump in, confirm that the claim option isn’t available in the order and reach out to our escalated shipping support team for the next steps. They will just need to get the order number from you to get all that started.
If for any reason you do not feel that you are getting the support you require on this ticket please don’t hesitate to reply back here with your current ticket number and details. I want to make sure we get this insurance claim submitted without issue.
I think I can help with future orders. We created an appthat allows you to offer a delivery guarantee to your customer no matter what carrier you use. You collect the money for this guarantee upsell and if something goes wrong you pay out the issue. Basically, you become self-sustaining and never have to fight with insurance companies or carriers for a refund. As a bonus you also increase your AOV by 2.5% on average
I have had the same experience where shipments have been lost in transit and if I didn’t have extra insurance (which I paid for) Shopify would not process even the minimum $100 claim. They said go to Orders and click “file a claim” well guess what ? As soon as I did that the message in red was “this claim is not eligible.” When I pressed USPS customer service they said they do not honor claims on shipping labels purchased through Shopify. Shopify is misleading us and it needs to stop. It’s false advertising. Now if I have any order over $250 and I have many I insure it myself because none of the carriers are a sure thing especially USPS. I have a package that is still sitting in Avondale, AZ since January 24th. I lost the sale, the merchandise and had to refund the customer. Shopify support does nothing - they say they will escalate the issue but you never hear back. terrible and misleading.
Shopify really needs to get this sorted, can you believe this has been happening for over two years? It’s rough when claims don’t go through, and end up having to refund customers while losing the merchandise.
One thing some sellers do to protect themselves is add a shipping protection option. Instead of relying only on carrier insurance, tools like Captain Shipping Protection let sellers add a protection widget on the cart or checkout page so customers can opt in for a small fee. The fee goes directly to you, if a package is lost or damaged, you can cover the replacement cost yourself without waiting on the carrier. And if no claims are made, those protection fees simply become extra revenue for your store.
It won’t fix all carrier or Shopify claim issues, but it gives sellers more control and makes resolving problems much faster, which leads to a better customer ecperience.
