“Help, So Many Lost Packages!”
This is a heading from a subreddit r/CanadaPost, in which a user complained about his experience with multiple lost articles during transit.
Now just imagine the reader to be the company the Reddit post is about. They try to maintain the best outlook, promise to provide the best logistic services, all the while trying to ensure that packages reach their destination unscathed and on time. One fear will push them: What if it happens to them? Their brand name could be in shambles, and with no way up, they may even have to close down.
According to a CTV News report, one out of every 10 Canadians had their packages stolen last year. The stats are so harrowing because many companies don’t care; they should, for there is an immense burden known as carrier liability that D2C companies have to shoulder.
Beyond just the reputation, situations like these are a true detriment to carrier liability.
Understanding what’s entailed in carrier liability is key for a brand’s survival, not just in terms of reputation, but also in terms of finances.
This article serves as a complete picture of carrier liability in Canada, giving you a statistical look into the matter.
What Counts as a Lost Package in Canada?
The definition of a “lost” package in Canada is subject to specific timeframes and conditions that differ between courier services and Canada Post, which means users can’t consider the package lost just because it is late.
To be more precise, a package is considered lost by Canada Post if it has not arrived after 10 business days in the case of domestic parcels, and up to 60 business days for international shipments, depending on the level of service.
Those who want to initiate a Canada package lost reclaim must do so after this window.
When it comes to private couriers such as FedEx, UPS, and Purolator, they have their own specific timelines.
With FedEx, the investigation is done after 3 to 7 days. UPS, on the other hand, takes up to 24 hours before initiating the UPS missing package process. And Purolator’s lost parcel policy considers domestic packages lost if they aren’t delivered within days of the expected delivery date.
There are many reasons that contribute to lost packages. Address validation errors happen to be the top one, followed by misrouting issues that emerge due to errors with barcode scanning. Shipping damage claims and package theft during delivery have also grown, especially in urban areas and apartment complexes.
Now comes the question of when the package is officially considered lost. As already mentioned, the guidelines are different. Here are a few excerpts:
- If a package is delayed but is still in transit, then users must wait for tracking updates.
- If there is no movement for more than 7 days, then the investigation could begin.
- And when there is no delivery after the official timeframe, a shipping claim in Canada can be filed.
Carrier Liability Explained
Carrier liability, in simple terms, is the legal responsibility of the shipping carrier for the parcel while it is in their custody. It means that if a package is lost, stolen, or damaged during the transit process, the shipping company has to compensate the sender, but only up to a certain limit.
Coverage Limits By Various Carriers
By default, each carrier has limited coverage. Understanding them is crucial for personal senders as well as ecommerce brands navigating shipping claims in Canada:
- Canada Post has a liability coverage of up to $100 CAD for tracked packages, but only if there is definite proof that the package has been lost or damaged by their network.
- Purolator’s Lost Parcel Policy has the same $100 CAD liability coverage. However, there are exclusions, such as improper packaging.
- UPS and FedEx offer similar liability coverage unless the shipper agrees to pay for an additional declared value.
The carrier liability impacts lost parcel claims massively, determining how much the victim could be compensated.
Another attribute to this is declared value, which comes into effect when the transit is considered high-risk or the item’s value is high. In this case, the shipper can increase the declared value during shipment, which increases the carrier liability.
It is not the same as shipping insurance, and applies only in limited scenarios. The carrier is still within its rights to reject claims if there are address validation errors, improper packaging, or a general lack of documentation.
How Carriers Handle Claims in Canada
There are multiple steps involved when filing a shipping claim in Canada, and all of them can vary depending on the carrier. That said, the general process is the same, and all of them consist of submitting proofs of value, shipping details, photos, and other documents. The success of these steps differs. Here is how Canada’s key couriers handle lost parcel claims:
Canada Post Claims Process
To file a Canada Post lost package claim, the sender has to go through the following process:
- Wait for 10 business days for domestic shipping and 60 days for international shipping
- Provide details like the tracking number, proof of delivery failure, and proof of value in the form of a receipt or invoice
- In case the package is damaged, photos should be uploaded
Senders have 90 days from the shipping date to initiate the claim. Resolution for this can typically take 30 business days, but it is subject to the severity of the issue.
FedEx & UPS Claims
To file a FedEx lost package claim or a UPS lost package claim, senders must do the following:
- Wait for 3 to 7 business days
- Submit a declared value invoice, tracking information, and proof of item value
- For damage claims, uploading relevant photos is crucial
Once the process is finished, both carriers typically resolve the issue within 8 to 15 business days.
Purolator Claims
With Purolator’s lost parcel policy, the process is as follows:
- Senders should file the claim within 60 days of shipment
- They must provide a detailed description of the issue, tracking info, and proof of value
In most cases, the issue will be resolved within 10 to 15 business days, but senders should provide complete information from the start.
To ensure that all the processes are done correctly, users should also know about the common causes of claim rejections. These include:
- Missing proof of value
- Incomplete address or failed address validation
- No declared value for high-value items
- Delays in claim filing
- Lack of proof of delivery failure
Therefore, users must ensure that they have all the documents ready from the very beginning before filing the claim.
Tips to Reduce Lost Packages
You must understand that some ecommerce shipping problems cannot be avoided, especially due to natural factors. However, there are ways to reduce the risk of package loss, misdelivery, or damage. D2C brands shipping across Canada should be aware of these methods.
Packaging Tips That Protect
To protect oneself from shipping damage claims, users must take care of proper packaging.
- Use durable outer boxes, tamper-evident seals, and bubble wrap
- Barcodes and tracking numbers should be easily visible
- The return address should be placed inside the box as well, to ensure there is still information available in case the outer box is damaged
- Use cushioning materials within the box, especially when delicate materials or electronics are involved
Looking for more packaging tips? Read this blog on to measure a box for shipping.
Address Validation Best Practices
Address validation errors are often the main cause behind a parcel delivery failure. Here are tips to avoid them:
- Validate postal codes in real time
- Avoid using abbreviations and ensure that apartment and unit numbers are entered
- Phone number and email address should be properly confirmed before the delivery
These tips help prevent package tracking issues, especially with manual entry.
Using Tracking Tools and Notifications
Senders should always choose carriers that offer real-time tracking and delivery confirmation. Using SMS and email alerts to keep recipients informed is essential as well.
Customers should be encouraged to track their packages themselves through specialized links. It helps reduce customer complaint handling load.
Another good tip is working with third-party logistics (3PL) providers. They can help streamline fulfillment and reduce lost parcel claims. Many offer perks like automated label printing, address validation, and optimized carrier routing, all of which are tools that reduce package loss statistics in Canada.
What to Do When a Package Goes Missing
A quick and clear action is what’s needed when a package goes missing. Here is the step-by-step approach to follow:
- Get Customer Report First: Ask customers to provide full order details, from the tracking number to confirmation of the delivery attempt.
- Conduct Internal Check: Run address validation and confirm shipping details. For assistance, verifying with the 3PL providers is also a good idea.
- Check the Wait Time: In case the tracking information isn’t updated, it is critical to check the carrier’s official wait time before a shipping claim in Canada can be filed.
- File a Claim: Senders should begin their lost parcel claim with the appropriate carrier. Getting the appropriate proofs beforehand, such as proof of value, tracking details, and photos, is crucial.
- Escalate if Delayed: If the resolution time is also over and there is no solution in sight, companies should escalate the issue with the carrier’s support team and inform the customers.
Here is a standard template that companies can go with:
“Hi [Customer Name],
We’re currently hard at work to find your missing package and have contacted the carrier. We will keep you updated and resolve it as soon as possible. Thank you for your patience.”
Who Pays? Breaking Down Responsibility
If the package is lost, the real question arises: who pays? Who will bear the responsibility of compensating the customer? It is an important factor, as it acts as a key determinant when it comes to customer trust.
If the sender manages to prove carrier liability, which means the package is lost in transit with proper tracking and address, the shipping claim in Canada could lead to a payout. However, there is a cap to the compensation (generally $100), and declared value shipping only works if it is pre-selected.
If, however, incorrect address validation, packaging, or missed deadlines on filing claims are the core issues, then the retailer is liable according to Canadian eCommerce laws.
With shipping insurance in Canada, whether it is bought from a carrier or a third-party provider, it is possible to cover the full value of an item. However, this is only helpful with high-ticket items and frequent D2C shipments. Lack of insurance caps the compensation to only $100.
Regardless of how clear this information is, when there is a missing item, most of it is forgotten. That’s why companies should frame their shipping policies in a way that the lost parcel claim process is properly highlighted.
Here are the details that must be added:
- Timeframes for reporting
- How resolutions are handled
- Whether refunds or replacements are issued
This ensures that the customer comes in with set expectations if their package is lost.
Shipping Insurance. Is It Worth It?
Shipping insurance has a lot of value. However, it does have some innate complexities that make people often ask, is it worth it?
The answer is simple, but before going into it, let’s discuss some key factors.
When to self-insure or opt for coverage?
If the item is low-cost or the brand has a high shipping volume, retailers often have a self-insure policy. It means they absorb the occasional losses instead of paying for insurance each time. In scenarios where the cost of lost packages is less than the amount spent on premiums, it makes sense.
That being said, for expensive items, it is wise to choose declared value shipping or go with a third-party logistics service provider for financial protection, since most carriers will only ever cover up to $100.
For example, if there is an item worth $300 lost, and the one who has suffered the loss only relies on the standard carrier liability, they will still lose $200, which is $300 minus the $100 coverage. With insurance, however, which only costs about $4, the entire $300 will be recovered.
So yes, since a small premium can save up to hundreds of dollars, it is worth getting insurance. It is crucial when dealing with package theft, shipping damage claims, and parcel delivery failure.
Carrier Comparison Table: Liability & Claims
Given below is a concise carrier comparison table, showing key details related to the liability and documents required by the most popular carrier institutions in Canada:
| Carrier | Max Liability (Default) | Average Resolution Time | Required Documentation |
| Canada Post | $100 CAD | 30 business days | Proof of value, tracking number, photos (if damaged) |
| Purolator | $100 CAD | 10to 15 business days | Tracking ID, claim form, proof of value |
| FedEx | $100 CAD | 8 to 15 business days | Invoice, declared value info, tracking, photos |
| UPS | $100 CAD | 10 to 15 business days | Tracking, declared value, proof of loss |
Final Thoughts: Be Proactive, Not Reactive
Missing shipment is a common occurrence, and getting panicked in the moment leads to compromising professional integrity, which does no good to any D2C brands in Canada. Therefore, the goal is to be proactive with the steps.
Do not wait for a parcel delivery to fail. Take the following steps:
- Focus on only reliable packaging and trackable services
- Always add declared value shipping and consider insurance for high-risk orders
- Ensure that the support team is trained to handle customer complaint resolution quickly and with grace
Even a single lost package can put a dent in customer trust. So don’t wait to react — act.
And the best way to act is to find the shortfalls in the existing systems and fix any cracks.
This is what ShippingChimp provides: a complete audit for the shipping process.
Strengthen your delivery process today by contacting our experts.
FAQ
What happens if a package is marked delivered but the customer didn’t receive it?
First, confirm with the customer that they checked all possible delivery spots, such as porch, lobby, mailroom, or the neighbors. If the package is still missing, contact the carrier to start a missing package resolution process. This may involve an investigation and sometimes a proof of delivery request. In many cases, package theft during delivery may be suspected, and insurance (if purchased) may be required for reimbursement.
How long do you have to wait before filing a claim?
Each carrier has different timelines:
- With Canada Post, you must wait for 10 business days (domestic), longer for international
- When it comes to FedEx & UPS, you must wait for 3 to 7 business days after the expected delivery date
- And in case your service provider is Purolator, you can file the claim after 10 business days
You must also file within a certain period (usually within 60–90 days of shipment) to qualify for a shipping claim in Canada.
What if the customer gave the wrong address?
The carrier liability often doesn’t apply if the customer has given the wrong address. The seller or customer is typically responsible in this case, depending on who entered the wrong information. Address validation tools at checkout can reduce these errors and protect against lost parcel claims caused by human input mistakes.
Can you claim for lost international packages?
Yes, but international claims usually a very long process and the documentation requirement could be very large. Canada Post, for example, may take up to 60 days to resolve international shipping claims. You’ll need the tracking number, customs details, and proof of value. Be sure the service used includes tracking and coverage.
Is it better to use shipping insurance or rely on carrier liability?
Shipping insurance in Canada offers broader protection than the limited compensation from carriers (usually limited to $100 CAD). If you sell high-value items or ship internationally, insurance can safeguard against shipping damage, package theft, and full loss. Relying solely on declared value shipping may not be enough in complex claims.
How do 3PLs handle lost package claims?
3PL providers often offer integrated claims support. It means that they may help with everything from gathering documentation, to initiating the lost package resolution. In some cases, they even with carriers directly. This can be a major asset for D2C brands looking to scale without bottlenecks in their shipping process.
What if the carrier denies your claim?
In case the carrier denies the claims, you will need to self-cover the loss or file with the third-party shipping insurance if it is available.
How often do carriers lose packages in Canada?
There are no exact figures available in regard to how many packages get lost in Canada. That being said, users have reported losing as high as 50% of their packages with Canada post in a year. And according to news outlets, 1 out of every Canadian gets their package stolen last year.
ShippingChimp offers free insurance up to $100. Shipping rates start at $5.11 and we offer free pick ups across Toronto, Montreal and Vancouver. Try ShippingChimp for free.
