The Legal Risks of Selling Shipping Protection Without a License

When Shipping Protection Becomes Insurance

Shipping protection might seem like a simple upsell - but if you’re not a licensed insurance provider, you could be exposing your business to real legal risk.

Here’s what you need to know.

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⚖️ What Is Shipping Protection (Legally Speaking)?

Shipping protection is often sold as a fee-based add-on at checkout that promises to cover package loss or damage. But if it functions like insurance, regulators may classify it as insurance - and that means only licensed entities can offer it.

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🚫 Real Legal Consequences

• California Insurance Code §§ 1631 and 1633: Prohibits the sale of insurance by unlicensed entities
• Unfair Competition Law (§ 17200): Can trigger civil penalties for misleading, unlawful, or unfair business practices
• Recent Lawsuits:
  • Wolf-Bond v. TA3 Inc. - Alleged deceptive shipping protection fees.
  • Miller v. Travel Guard Group - Reinforced legal exposure for unlicensed sales.

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📉 Why It’s Risky

• Automatic opt-ins can be seen as deceptive.
• Ambiguous language misleads consumers.
• Denied claims lead to chargebacks and complaints.

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✅ A Safer Alternative: Licensed Insurance with U-PIC

U-PIC is fully licensed and compliant in all 50 states and Canada. Our shipping insurance:

• Is a real policy, backed by underwriters.
• Has clear terms and fast claims.
• Keeps your business on the right side of the law.

Whether you’re a platform, 3PL, or eCommerce brand, don’t gamble with compliance. Offer insurance the right way - with U-PIC.