PACKAGE INSURANCE, YES OR NO?

[gsmcoins09]

I have noticed that when I insure a package containing an expensive ebay item that I have sold, the package never travels through the postal system like normal packages do.  I ship dozens of packages per month but most items are valued at under $100.  I never seem to have a problem with those packages.  However, I was burned once when I shipped an item valued at $600 via priority mail signature confirmation and it was lost somewhere in the postal system.  I was only refunded the standard $100 and I lost $500 in a refund back to the buyer.

Last week I made a sale of a $4000 item.  I was terrified that I may be liable for this amount of money if the postal system loses the package again, so I purchased full coverage to cover myself.  The package was dropped off at my local post office on April 16th with a promised 2-3 day delivery time.  It was scanned into the postal tracking system while I stood there and watched.  The next morning the scan indicated that the package had left my local post office.  That was the last scan on the package for the last 5 days.  Now the tracking indicates that the package is moving through the postal system, no location provided, and that it will be arriving later than expected.

Does anyone on this forum feel like I do that placing a substantial amount of insurance on a USPS package draws attention to the package by unscrupulous thieves in the postal system who decide to take the package home with them, knowing that the lost mail claim will be paid by the USPS, not them.  Has anyone experienced this phenomenon when shipping packages with over $500 of insurance attached?  I really don't trust the people working in the post office any more after seeing my packages misrouted 4 out of 10 times and some never reach their destination.  I have had to file 3 claims for refund with USPS in the last year.

[buyselljack2016]

As a general rule no human sees your package to do any reading of the label during the shipping/processing once it leaves your Post Office until it arrives at the Post Office of delivery, so no I do not feel that any attention is drawn to an "insured" package. Processing is automated.

[buyselljack2016]

And that "left the Post Office" is an autogenerated event for the item. 

After that happens the system autogenerates a "moving through the postal system, arriving late" event when an actual scan does not happen within the expected delivery time.  A scan would be expected to happen at the next "regional facility" that processes that package. 

[reallynicestamps]

This is what a postal terminal looks like.

Many of those parcels have as high or higher value than yours.

In addition USPS, like FedEX UPS and all airlines use a Hub and Spoke delivery system, which doesn't appear to make sense but apparently is the most efficient way to handle large amounts of cargo.

https://blog.locus.sh/hub-and-spoke-distribution-model-in-modern-supply-chains/

The other question then becomes, what do you think you are insuring against and how do you think insurance protects you?

I would suggest that you may be equally protected by Cookie Jar Insurance, which is just putting a tiny amount of each purchase price into a virtual Cookie Jar as a sort of self-insurance premium against failed transactions of any sort.  At the moment it seems that you are paying out on failed transactions, but don't have that Cookie Jar.

A second thought is third party (fourth party) insurance rather than postal insurance. We have used Hugh Wood International for decades.
https://hwinternational.com/ca/

They are the insurer for the American Philatelic Society, insuring not only shows and bourses, where the usual way of protecting high value material is a clear plastic tablecloth over the stamps, but also their circuit books which send books of stamps from one collector to the next through the mail for purchase until they complete the circuit and return to the APS.

They specialize in collections. Both collectors and dealers.They also insure premises , homes and shops, and collections in transit.

Currently we are using them to insure not only our stock but also our art collection.

They do require annual contracts.

I have heard good things about one-off companies like shipsurance, but have never used them.

[pcobra93]

I have argued for years as to why we have to pay additional insurance for a lost or damaged item by a shipper. Think about that.....especially a lost one. I don't pay my mechanic an additional insurance fee when i take my car to get worked on....if it was stolen from his shop....he has to pay for it.