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Q. I paid UPS for an insurance policy to cover any damages en route for a shipment I sent. UPS dropped or somehow damaged it in shipping so badly that they destroyed the contents. UPS (actually the insurance company they contract with) has since refused to pay out on this insurance policy claim for $1,000 and they keep changing their reason for doing so. They did this to us once before when we had a similar problem a few years ago and had to go through several steps in order to get compensated for our loss at that time. This time it seems that they are taking a harder line and are finding any excuse they can to ignore this issue and not pay for the damage that they caused. If it has happened to me I'm sure that UPS is doing this to others. Please help me out with this situation.
Roger M. GrubbA. Roger, I am happy to help you out. I talked to Susan Rosenberg, the public relations manager for UPS, and she told me that your claim's denial was related to packaging. "Not all claims are denied at first -- each claim is reviewed individually and involves the documentation from the shipper. UPS works with Crawford & Company, the world's largest third-party claims administrator, and they respond to the initial documentation or ask for supplemental information. We may have inspection of packaging, either through photos or the actual original packaging in hand."

Here's how the policy works: Declared value isn't, actually, insurance coverage -- instead, it's UPS's maximum liability for the package in the case of loss or damage. If no value is declared, the company's liability is limited to $100. If you are shipping something with a value that exceeds $100, you pay an additional charge to declare that higher value.

The second part of this is that the shipment has to be packaged correctly. I know what you're thinking -- you did package your shipment correctly. I agree with you, and after further review, so does UPS, says Rosenberg.

As a result of that additional research, they've decided to process your claim. The $1,000 you are owed will be sent to the third-party shipper you used, and they will, in turn, cut a check for you. UPS issued the check at the beginning of last week, and the claims process typically takes 7-10 business days. You can contact your local shipper to check the status.

And now, a bit of advice, for you and other readers who ship packages with pricey contents:
  • Always take the package into a local shipper and ask how it should be packaged. They should be able to tell you what is required so you can ensure that your claim will be processed -- and quickly -- if something goes wrong.
  • Take pictures of how the item is packaged so you have that proof at the ready, should your claim be denied.
  • Have proof of the value of your item handy -- if you need to file a claim, it's one of the first things you'll be asked for.
  • Finally, make sure you read UPS's fact sheet on declared value. It should have all the information you need, but if not, ask your local shipper or call the company's customer service line with questions.

Consumer Ally problem solver Jean Chatzky is the "Today Show" financial adviser, a longtime financial journalist and best-selling author.

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