When incidents occur during transit, a carrier is typically only liable for the shipping costs. This is where SVP (shipment value protection) comes into the picture. When you opt into SVP on your shipment, any damages, theft, or lost items in the shipment may be recompensed based on the value insured.
Through DHL, there is a limited liability coverage that follows the air cargo international law. The Montreal Convention Treaty calculates liability coverage as 22 Special Drawing Rights (“SDR”) per kilogram of lost/damaged items. An SDR is an artificial currency unit maintained by the International Monetary fund for use in certain
international transactions such as cargo claims. The formula used is (Weight in kilograms X SDR
value X 22). This formula will help you calculate the maximum coverage DHL offers without additional Shipment Value protection.
The cost for Shipment Value Protection through DHL is $1.25 for every $100 of the declared value of your shipment, with a minimum of $3.75 for exports and $10 for imports. You can insure your package up to $500,000.
For example:
if you were shipping a piece of original art that weighs in at 20 LBS with a value of $2,000, the standard coverage would only be $226.80, so if there were an incident you would only get up to 10 percent, $22.68, of the value back. With Shipment Value Protection through DHL, you pay $25 dollars and the $2,000 would be completely covered, if an incident were to occur.
How to protect your shipment.
When creating your shipping labels, you need to make sure to select Shipment Value Protection and input the value you wish to insure your shipment for. This option is normally after the invoice section, and can be chosen whether you provide your own invoice or make one through the label preparation tool. You can insure at or below the declared value of your shipment, which is indicated on your label and invoice.
Now that you know how Shipment Value Protection works, you're ready to ship your high-value shipments!