Importance of Declared Value When Shipping Internationally

Importance of Declared Value When Shipping Internationally When mailing a package, you are typically required to state its declared value. Failing to do it right may cause issues if you need to claim insurance, or customs issues when shipping internationally. Why exactly is declared value so important, especially when it comes to international shipping?

Declared value is the amount a shipper states to the carrier that the shipment is worth for insurance purposes. In case of loss or damage, the amount of compensation is determined based on the declared value of the package. This is true for both domestic and international packages. When it comes to international shipping, declared value is also used to determine the amount of duty to be paid for the imported goods.

With domestic shipments, declared value only matters in case of package loss, damage, or theft, so if you get the declared value of your package wrong but the shipment gets to its destination without any issues, it won’t cause you any problems. However, when it comes to international shipping, not declaring the value of your package accurately may result in customs delays and even penalties.

While it might seem tempting to undervalue your package so that the recipient ends up paying less in customs fees, it is a really bad idea because it is illegal and may lead to customs delays, package seizure, and customs fines. But how exactly to determine the value of the items you’re shipping internationally?

If the shipment is commercial and you’re the seller, it’s easy: the goods are worth as much as the customer paid for them. All international commercial shipments require a commercial invoice so that customs authorities can make sure that the declared value matches the actual value of the goods being shipped.

The main sections of a commercial invoice are: air waybill number (can be found on the shipping label), date of export, invoice number, shipper’s (exporter’s) information, recipient’s (consignee’s) information, country of export, reason for export, country of destination, information about the goods (country of origin, quantity, full description, harmonized system codes, weight, unit value and total value, etc.), the total weight and value of the package, and signature. It is important to make sure that the information in the invoice is consistent with the information in the customs declaration/shipping label.

If your shipment is non-commercial (for example, a gift for a friend), determining its value can be a bit tricky. If the goods are recently bought, their retail price is their declared value (keep in mind that customs authorities may require a copy of the retail receipt as proof of value). If the items are not new, consider the value of comparable goods and/or the replacement cost of the items being shipped to determine their appropriate declared value. And don’t forget to mention in the customs declaration that the goods you’re shipping have no commercial value, i.e. identify them as a gift.

So, let’s sum it up. The declared value of an international package is important for insurance purposes, especially when you’re shipping high-value or irreplaceable items, and for customs purposes. It’s crucial to get it right in order to get reimbursed in case of loss, damage, or theft, and, more importantly, to avoid customs delays, package confiscation, and hefty fines. Keep in mind that if you undervalue the package, it is the recipient who will end up being held responsible and paying the fine; you don’t want them to have any problems, do you?

Another thing to remember is that shipping carriers provide default insurance coverage up to a maximum limit (usually about $100 or so). If the declared value of your shipment is greater than that, you should consider purchasing additional insurance, otherwise you won’t be fully reimbursed should something happen to your package.