The great Royal Mail insurance ripoff

[e-rider]

Scenario 1.
You sell something on ebay for £22. You send it Royal Mail 1st class. Item never arrives - lost in the post. You submit a claim to RM with receipt printed from ebay account showing item sold for £22.
RM insurance payout = £0

Scenario 2
You buy some clothes online that cost £60. They arrive and don't fit so you send them back using RM 1st class recorded (signed for) as the shop doesn't offer a free returns label. Items never arrives back to the shop - lost in the post. You submit a RM claim with shop receipt showing clothes cost £60
RM insurance payout = £0

You get the picture!

Standard post covers items to £20
Recorded 'signed for' delivery covers items to £50

I always thought that if the item was worth slightly more, then if you had to claim you'd only get up to that amount e.g. £20 or £50; but in fact if your item is worth 1p more you get absolutely FA!!! So if you send something that cost £50.01 1st class signed for, and it goes missing you get £0.

What a total ripoff

 

[twentysix by twentyfive]

Use a different carrier or a different insurer?

 

[e-rider]

I'm now thinking "do other carriers use the same ripoff system"?

 

[screenman]

Does not seem rip off to me, rules are rules.

 

[oldfatfool]

Use Special delivery. Recorded delivery is really only for proof of receipt.

As for your thoughts on insurance, try insuring your house contents for £10k when the actual value is £100k and see what happens if you make a claim!

 

[accountantpete]

Royal Mail compensation covers the Cost of an item - so sales proceeds don't count. I sold something for £20 that was lost but still had the £32 cost receipt and I got £32 back.

Also there are a special postage rates for high value items - the staff at the counter normally ask the value of the goods so they can advise you.

 

[e-rider]

Use Special delivery. Recorded delivery is really only for proof of receipt.

As for your thoughts on insurance, try insuring your house contents for £10k when the actual value is £100k and see what happens if you make a claim!

when my bicycle was stolen, it was only covered to £500 but was actually worth much more. The insurance company paid me £500. That seemed reasonable to me!

 

[screenman]

[QUOTE 4196663, member: 45"]What were their grounds for not paying out?[/QUOTE]

I would imagine not insured as they were over value.

 

[screenman]

when my bicycle was stolen, it was only covered to £500 but was actually worth much more. The insurance company paid me £500. That seemed reasonable to me!

Would it not be a good idea to start insuring things properly to their true value.

 

[oldfatfool]

when my bicycle was stolen, it was only covered to £500 but was actually worth much more. The insurance company paid me £500. That seemed reasonable to me!

Was that the max amount they would cover a bike for on the policy or the amount you had specifically insured it for? I know my insurer covers all bikes for upto £500 on house policy as std but if I value them above £500 I have to list them individually and pay a premium. I know that with some if not most insurance if you under estimate they will only pay out proportionally so for eg if you did have £100k of contents insured for £10k and you had £10k worth of goods stolen then you would only get paid out app £1k. http://www.financial-ombudsman.org.uk/publications/technical_notes/under-insurance-household.html

Like I say though if you want to insure goods through royal mail then Special delivery is the way to go atm, it is the only way the items are tracked securely through the system and hence why it is the only product that offers insurance for higher value goods. Products are changing/ evolving to offer the public consumer alternative tracked services but what levels of insurance these will carry...... as always you get what you pay for.

 

[vernon]

Standard post covers items to £20
Recorded 'signed for' delivery covers items to £50
What a total ripoff

The two statements seems pretty clear to me.

If the goods cost more than £20 then you need to pay for an upgraded postal service e.g. recorded signed for delivery if you want a payout on loss.

If the goods cost more than £50 then recorded signed for delivery is not the product to purchase for cover against loss.

The service is not a rip off. It delivers what it promises in the terms and conditions.

 

[vernon]

when my bicycle was stolen, it was only covered to £500 but was actually worth much more. The insurance company paid me £500. That seemed reasonable to me!

It seems stupid to me. Stupid as in not insuring it at its true value.

 

[vernon]

I'm now thinking "do other carriers use the same ripoff system"?

It's not a rip off system.

 

[Over The Hill]

Scenario 1.
You sell something on ebay for £22. You send it Royal Mail 1st class. Item never arrives - lost in the post. You submit a claim to RM with receipt printed from ebay account showing item sold for £22.
RM insurance payout = £0

Scenario 2
You buy some clothes online that cost £60. They arrive and don't fit so you send them back using RM 1st class recorded (signed for) as the shop doesn't offer a free returns label. Items never arrives back to the shop - lost in the post. You submit a RM claim with shop receipt showing clothes cost £60
RM insurance payout = £0

You get the picture!

Standard post covers items to £20
Recorded 'signed for' delivery covers items to £50

I always thought that if the item was worth slightly more, then if you had to claim you'd only get up to that amount e.g. £20 or £50; but in fact if your item is worth 1p more you get absolutely FA!!! So if you send something that cost £50.01 1st class signed for, and it goes missing you get £0.

What a total ripoff

So why not use the correct postage grouping to cover the value of the item you require? Seems they have three groups and you choose the one you want depending on the value. Then you are covered.

Choose the wrong group (so that you are not paying towards the insurance of the item in the postage cost), then you have then not paid towards or taken out insurance .

 

[PhilDawson8270]

I don't understand how RM or any carrier can believe it's acceptable to charge for insurance of their own incompetence?

You have already paid for a service, if that service fails, they must surely be liable regardless of "insurance". Buying insurance to cover yourself, if they, themselves fail in their service is wrong.

I wonder if anybody has gone to small claims with a case against a RM parcel loss that was uninsured.