Shipper is responsible for insurance:Discussion

Over on AA in the vinyl section, we had a lively discussion of who is responsible for insurance, and why. My (RANT) take on this,(backed up by the laws about this) is that the shipper is soley responsible.
The buyer has a right to expect the goods delivered exactly as advertised, or, he has a right to reject them. If the goods are broken in shipment, the SELLER must be the claimant, as HE paid for the insurance, and did the packing.
Why so many sellers try to weasle out of responsibility is curious to me. Laziness? Because they can get away with it?
My stance is that (even if the seller includes the cost of the insurance in the selling/shipping/handling cost) the shipper is soley responsible for the goods arriving in the condition claimed in the advertisement.
Many folks feel that by issuing a disclaimer as seller, they are no longer responsible. I say they ARE STILL RESPONSIBLE, and should act accordingly.
No more "it ins't my (seller's) fault blah blah blah, it IS the sellers responsibility!!! and if the stuff is trashed, it belongs to the seller, and a refund is promptly due the buyer, as the seller failed to deliver what he promised.
If this issue could be clarified, I think it would benefit all the buyers and sellers.
Any comments?
Agree 100%. Only the seller has control over actually purchasing the insurance. The buyer may be charged for it, but he still can't ensure, heh heh, that the item is insured. Only the seller can do that, and it's then a contract between the seller and the insurer, who has assumed the risk of the shipper. This was discussed on a motorsickle board that I frequent, and the (reasonably large) parts company actually asked a customer to "send the money a second time, until the insurer settled" since the shipper lost the goods. Unbelievable.
You are right on the money Elizabeth. The seller is responsible for the packing, shipping and safe delivery of the item as advertised. If the product does not arrive in said condition, it is the sellers responsibility to deal with filing the claim. It should be at the buyer's discretion as to whether they want to wait out the results or obtain an instant refund as it is not their fault that the product was damaged or lost during transit. As such, the seller should NOT "blow" the money that the seller sent them until the transaction has been fully completed and all parties are satisfied.

Having said that, in situations where i've received damaged goods, i've typically asked the seller to sign a waiver giving me the rights to pursue the claim on my own. Since i do business with UPS / Fed Ex on a commercial level and most of my incoming parcels are shipped to my shop, i tend to get slightly faster and better results than they might dealing with either of them as an individual. Having had to file a few claims along the way*, i've learned a few tricks that tend to work in my favour. Sean

* Most of the claims that i've had to file boil down to the fact that the parcels were NOT properly packed. However, UPS did accept them for shipping and agreed to insure the contents, regardless of whether or not they inspected the contents prior to shipping. If the product did not meet their standards for shipping and proper packing, then they should not have accepted the funds to insure said parcel. Once they accept such fees, they are legally bound to cover any damage that occured while in transit. Otherwise, they are breeching the contract that they made at the time of accepting responsibility for said item and you can sue them if necessary in order to recover any loss or damages incurred. Sean
I think there ARE laws that govern the transfer of title and liability between shipper (seller) and shippee (buyer) whether it be before, during or after the goods are transfered.

Somehow, these laws, Uniform Business Codes and Incoterms, are not used as much when personal goods are involved. Is there a reason for this or are people just not aware?
From the insurance standpoint, I will tell you how large insurers see it.


You accept money for goods. You pack the items and take them to work the next day to ship. You make the deposit at lunch, but when you leave after work to ship the item, it has been stolen.

These large insurers view the item as NO LONGER BEING yours, since you were paid for item. The transaction and possession have transpired, ownership has transferred upon acceptance of payment.

I concur, the shipper has the responsibility to file the claim, follow up, and as Sean states, file a release to the buyer since the shipper has NO INTEREST in the unit. By interest, I mean proper authority to make decisions as he/she are no longer the legal owner.

I disagree the buyer has the right or option to choose to follow the claim or demand a refund. If the item has not been packaging properly, then I agree, buyer is 100% responsible. HOWEVER, if packaged properly, or in factory package, I do not feel the buyer should FRONT the money for the refund AND wait for the carrier to make the their decisions.

Unfortunately, in this situation someone has to take the risk, and I, personally, with proper packaging, feel the BUYER is the one to accept the risk. The buyer accepted this risk upon purchase, entering into the possibility of damage during transit. Now, this would be my stance in a 'repair' bill, versus a 'replace' or 'total loss' bill.

As a buyer, you need to be aware of such potential risks of loss, and DEMAND/PAY for security. Proper insurance, proper packaging, and the likes just as the seller should demand such.

I recently sold a Velodyne HGS-18II, FACTORY SEALED. It arrived to its destination, damaged. I did nothing wrong in describing the item, promising proper timeliness of shipping so how can I be held responsible? What if I already owned an HGS-18II that I dropped a Theta Dreadnaught on and cracked one end. Ah, I know, buy one from someone, swap them out upon delivery, demand my refund, and let the poor seller deal with it. THIS HAPPENS!

Someone just purchased a Sony DVP-7700 from me. Unit had some superficial surface scratches on top, nothing major, and came with factory packaging and box. BUYER wanted complete safety, and paid to have the FACTORY box put into a larger box, with added padding/support. Not to mention the size of the box and newly added weight added to the cost of shipping. This is responsiblilty for BOTH parties involved.

As a buyer, I do not like NON FACTORY packaging. RARELY does anyone package properly. It is not cheap, it is not easy, BUT as a buyer AND seller, both need to be aware of the risks of going 'cheap-o'.

Rule of thumb, (does not guarantee safe delivery) buy with factory packaging. If not, BE SURE IT IS DOUBLE BOXED with PLENTY of packaging, foam, and according to the carriers demands.


Sean, how sure are you that UPS would agree that everything they ship insured is their liability for accepting it insured as such? I see too much optimism in that belief or intimation... I've got a $6k case at my employer that speaks volumes otherwise, and it is only a marginal shipper negligence case. Still, I don't think you're making that case so much as having had a reassuring bit of luck in working with them -- not all of us are as lucky to have such claims workers in our area.

I remain skeptical of all shippers, and when the seller is negligent, I find that to be the hardest of situations for the buyer. It's almost like being mugged - the seller and the shipper both can act like they're not on the hook, and your costs to prove either wrong are too high to pursue. Triumph of the system --- and the UPS / FedEx game plays the curve, with their risk pool paying out only the worst and most highly litigated of their mistakes. Buyer/receiver loses.

I suggest to ALL audiogon'ers to DEMAND of their shipper to double-box shipments that such service is appropriate for (anything at all heavy, or already in manufacturer packaging that weighs anything over a couple pounds). Unfortunatley, alot of sellers will pay you lip-service -- but make it clear to everyone that you are expecting xx of service as described, or paying extra for xxy, and that's how it is. And when selling, get ready to accommodate the same.

Do your best unto people, hope for the best unto you. In an ideal world, expect their best as well.

I used to work for a large trucking company, and I can tell you, things get damaged in transit. This is why buyers want insurance and the shipper should also want insurance on any item they ship. Our company had it's own insurance, or I should say, it was self insured, which certainly is under strict guidelines and the customer pays for it.

Dan is correct, that once an item is paid for, the item belongs to the purchaser. However, improper packaging is a fault of the shipper. Abuse to a package in transit, is the fault of the shipping company. This is where the problem lies. Who caused the problem? When it comes to a company parting with "Insured value" monies, blame is going to be placed on someone and they will end up paying for it, either directly, or through their insurance.

Elizabeth is exactly correct, the seller is responsible for taking care of the mess, if something goes wrong and the item gets damaged. This seems backwards, since the buyer is actually paying for the shipping, just look at any manifest (The buyer is actually the owner) but the carrier, like UPS, FedEx and USPS, require the shipper to make the claim and the payment for the insured item, will go to the shipper. It may be wrong and it is a hassle to the seller/shipper, but that is the way it is.

Unfortunately, I have had an experience with this, through FedEx and a pair of speakers that arrived damaged. The seller wasn't going to do anything and it took many calls and emails to get him off his behind to take care of it, but I was told by FedEx, the shipper is the one who will need to follow up, and he was going to receive any payment, if they decided the speakers were packaged properly. This is something that Dan touches on, but I feel that the seller is ultimately responsible for the packaging. It is an item that no longer belongs to him and it is in his/her charge. He didn't pack right, but did the right thing and return my money. He ended up eating the speakers, but that wasn’t my fault or FedEx.

I have been on the other side, with USPS and an expensive golf club. The postal worker broke a $500.00 driver into 4 pieces! The buyer told me of the condition imediately, since he was going on vacation with his new club, and I refunded his money. It took 4+ weeks to get the Post Office to give me the money, and then they wanted to give me less than it was insured for. That is a whole other kind of mess.... but that is for the insurance types to discuss.

My thinking is, the seller is responsible for the packaging and it is part of the "risk" that the seller incurs by selling and accepting payment for an item and then arranging shipping. It is a hassle if something goes wrong, agreed, but the shippers are going to hold the seller responsible for the claims and the packaging.

If a seller is saying, "I'm not going to be responsible for any shipping problems", or something to that effect, stay away. They are going to be a real problem for you, and this will make a bad situation even worse. No one wants damage to occur, but lets face it, we all live in the real world, and the shipping companies have it set up that the seller/shipper is the responsible party for the claims.

Dan makes a good point, in discussing the packaging with the seller. I agree; if it is an expensive or heavy item, pay for the proper packaging. But all sellers out there, be aware of the responsibility that the shipper is dropping on you, when you ship an item, YOU ARE RESPONSIBLE FOR THE CLAIMS. It may not be a fair world, but I’m sure you parents already told you that. There is risk in both buying and shipping.
I'm a bit confused by Dan's opinion, but it seems to rub me the wrong way. Whether or not the insurance companies recognize the item as the seller's property at the time of loss bears no impact on the moral discussion in my view. Insurance companies and most lawyers (or black-letter law itself) are two steps below snail dung on the scale of morals so I sure wouldn't consider it a noble standard to be held too. Nor would I consider the other immoral example of someone doing a bait-and-switch and blaiming it on a shipper. What the fu*& do dishonest practices have to do with the question at hand?! People get away with robbery and murder too, so does that make it something to strive for? If you purchase an Audio Aero from a dealer, and it arrives damaged, factory packing or not, you would fully expect the dealer to handle the claim 100% and make good on the purchase immediately with a replacement unit. Any dealer who didn't would not be one I'd deal with. The same would hold true with an individual. I own my own business and have for over twenty years now. If I use a third party vendor to complete a task involved with a job, and THEY screw-up guess who's responsible to my client. That's right, it's still ME. I chose to do business with that vendor and if I didn't make good on their mistake to my client I would not be in business very long. If you are agreeing to sell an item through the means of shipping it a distance using a third-party, I believe it should be the sellers burden to deliver the goods exactly as described. The buyer has every right to expect the item to arrive as described, and should not be burdened if it does not. I agree with the observation about factory packing being one good means towards this end, but it does not guarantee safe arrival by any means, especially given the state of ground shipping these days (reminds me of that Samsnite ad with the apes throwing around the luggage in the cage). Double boxing is best with plenty of packing. Even then damage can still occur. I don't care if the seller packs the item in a steel crate with down feathers, if the item does not arrive to the buyer as it was described (within reason) it is the sellers responsibility to make good on the full price of purchase. Period, end of story. I sell and pack and ship my items with that kind of integrity, and fully expect the same from anyone selling something to me through a shipper. I have been on the bad end of damage more than once both as a buyer and a seller and have always conducted my business that way.

jaxz -

Relax. The header of this post is "DISCUSSION" which is just what I am doing, discussing, using my views and opinions. The insurance part is JUST A COMMENT, which I think is of value IN GENERAL.

I am not saying the seller is out scott-free once shipped.
Obviously the buyer and seller have to work together to resolve the situation accordingly. I simply disagree with above comments that the buyer should have the 'right' to decide if he or she wants to pursue insurance or receive a complete refund from the buyer. I feel BOTH parties need to work it out, and make the decision TOGETHER. I am not opposed to providing refunds to make the new owner whole, just don't feel it is their decision exclusively!

Hope this makes sense.....

Dan has the buyer / seller / insurer mixed up in his wording on some places. I agree that it is lacking in clarity but if one reads through the post and substitute's what they think should go there, you'll get the main points that he's trying to make.

As far as me having "luck" on a local basis, it has nothing to do with "luck" or being "local". I've had to muscle my way through all of my claims except for one and all of them have dealt with UPS' Texas location that handles claims. Sean

Thanks for the clarity! Indeed I have the wrong buyer/seller mixed up, and it is pretty obvious once I read it again!

That is what happens when you only sleep 2 hours because you are so excited to get up and read AGON posts!! Sleep Dan, sleep!

Thanks, and sorry for the confusion!!
As I said Dan, your post was a bit confusing and I reacted on face value. Thanks for clearing up the mixing up of buyer and seller in your statements as that was where much of my confusion came from. Rest assured that I am quite relaxed though. I too am discussing the same subject and offering my points of view as well. I just happen to state them with a bit more emphatic emphasis, and they just don't happen to allign with yours, or what I interpretted as yours from the words you chose. I still don't understand what you were trying to point out by citing the fact that there are dishonest people in the world who conduct themselves immorally. It seems entirely beside the point to me.

Hifirush- your pointing out the black-letter chain of responsibility is all well and good, but the fact remains that actually getting the insurance companies to make good on their coverage is a major inconvenience, and a tremendous effort. Anyone who's ever had to deal with a ground-shipping insurance claim would likely attest to this. There certainly are exceptions, but they are few and far between these days. So the question remains, who should bear the burden and headache of making the claim. Though black-letter law may state that once the cash exchanged hands the item is the property of the buyer, I would strongly disagree that it should be the buyers burden to pursue a third-party insurance claim with a shipper. I believe that part of the contract that is implied, and I have no idea whether law actually supports this (and, per my previous post clearly don't give a rat's-a*& as far as my own opinion is concerned), is that the seller agrees to deliver to the buyer the item the buyer paid for in exactly the condition it is described. The seller should be responsible for third-party insurance claims, not the buyer. Yes, clearly it is the shipper who may be at fault and who ultimately is responsible(assuming the item is properly packed - and each shipper has pretty clear guidelines which specifically indicate what proper packing is to them), but it still will be an issue between seller and buyer as to who pursues the claim, and who has to wait for the money. Again, given the same damage-in-shipping scenario with a merchant selling an item to you I don't think any of us would hesitate a second to expect the merchant to make good on the purchase, even though, by your recitation of black-letter law, the actual item is the property of the buyer already in the exchange of funds. If we are acting as a seller, whether it is a one-time transaction, or 1000 transactions a year, we are still doing business selling goods by mail, and thus acting in the same capacity as the merchant. Why should we be held to different standards?

jax2 -
Understandable, and surely no hard feelings taken or given.

My bottom line is:

Pack EXTREMELY well, understand BOTH parties are equally responsible, IF properly packaged, in pursuing insurance.
I do not think the SOLE responsibility is on the seller/shipper.

I have had/have a few claims and each/everytime, the recipient has been happy with working through the carrier, as opposed to demanding a refund and leaving it up to me.

My only disagreement is allowing the buyer the right of refusal to reject mediation with the carrier, leaving all of the burden on the shipper.


It's simple, either its FOB shipping or FOB destination.
As a buyer I am uncomfortable with the concept "you paid for it so it is yours (whatever happens to it)" and with the situations when seller has both the money and the goods and the "discretion" to pack, insure and ship. Sometimes “cutting corners” on proper packaging with the excuses like being in a hurry, being unable to find box big enough, packing would be more expensive than paid for, etc… Ever had such an experience? Well, I did and it was bad (and I bet you did too).
My solution to the problem was to use escrow service. I believe it levels the playing field and does good for both the buyer and the seller. It cost some money but you are getting peace of mind. As a buyer I pay all service fees. Seller now has natural interest to properly pack and insure the goods because they are his until accepted by the buyer (or after pre-defined inspection period is over). I am sure that large percentage of the disputes on AudiogoN could have been avoided if escrow service have been used. I would love to hear your experience and comments.
Arago - YES, I have had the experience more than once that the shipper underpacked an item and the item was damaged as a result. In THREE separate cases out of maybe six to eight total, I had VERY specific conversations with the sellers about careful packing, double-boxing, proper packing materials. In all three cases the sellers assured me up and down that they were very careful and would use all the right stuff. In ALL THREE cases when the item arrived severely damaged the seller dropped the ball and DID NOT make good on following up. In two cases I had to pursue the claims which were absolute nightmares that lasted over 90 days and dozens of frustrating phone calls to the insurance division of UPS and FedexGround both which were prepared to deny very legitamate claims in both those cases. I was not assisted in any way by the sellers as they all three denied responsibility. One was kicked off Audiogon as a result (there were other circumstances as well that precipitated that action from my transaction with him). The other two simply got negative feedback and never attempted other transactions on A'gon as far as I know. In the third case I ended up spending about $400 of my own money in a repair. UPS would NOT foot the bill as the item was clearly not packed properly.

Escrow is a great solution. And guess what; you are absolutely right, in the case of Escrow, the burden, as it should be, is on the seller to deliver the goods as described. The debate then is who pays the escrow fee, and in my experience it would most likely be worth it as a buyer if you are investing serious money in an item.

Dan, no hard feelings here either. We simply disagree I think. My feelings, as stated, are it is 100% the sellers responsibility to deliver the goods as described to the buyer. I completely agree on your endorsement to overpack everything. The small investment which can certainly and rightfully be charged to the buyer if disclosed ahead of time, is well worth the insurance it will yield.

In NH if the seller says "äs is where is" you have to disclose ALL the defects and possible defects of the item before you sell to someone within the state.

I'd go to the FTC site and see what they say.

I think the NH rule is good selling policy. If the buyer pops for insurance it comes back on me as a seller unless I use their account, in which case they take reponsibility for transport. But I'd still work with them as a responsible seller and Audiogoner.
Jax2, I agree with you 100%! Perhaps all this "Letter of the Law" talk is confusing, it is to me. If the carrier, (UPS, FedEx etc.) is at fault, due to abuse, they will pay up. If the shipper (the seller) is at fault, by lack of proper packaging, as determined by the carrier (UPS, FedEx etc) chances are they will be held liable and the insurance may or may not pay. What I believe is the point of this post, is trying to figure out who is the party to pursue the claims in the event of damage to a package, and that falls on the seller. All of the carriers (UPS, FedEx etc) make this perfectly clear. It is a hassle. It is time consuming. However, it is the way it is and sellers need to be aware of this and buyers should hold the seller accountable, whether it is the carriers or the shippers fault of the damage. It is up to the seller/shipper to make the claim and collect the insurance. I hope this makes my point clear.

Best regards, Matt