Transit protection: why is loss and damage still costing Australian businesses so much?

Damaged and lost freight are an occupational hazard in the world of delivery. No business is immune; every brand has fielded angry calls or received 1-star reviews from customers whose order was damaged or never arrived at all. Businesses that treat it as ‘unavoidable’ expose themselves to huge risk. 

According to a FreightSafe report, Australian businesses lose $2 billion in freight every year to damage, loss, and theft. More than three quarters of claims (77%) relate to goods damaged in transit. In most of these cases, the end recipient is the first person to notice. That means the damage is already done, and the customer is already unhappy before your business even knows there's a problem to fix.

Of the claims related to loss, 83% of parcels are never recovered. That's a full write-off: the item, the freight cost, and the sale all gone at once. FreightSafe’s research mapped almost 30,000 claims across 4,200+ freight corridors, finding that loss and damage don't track neatly with distance or “risky" routes. Often, they appear in pockets, on parcels, or on lanes that businesses assume are safer.

That's the problem with how most brands protect their deliveries today. Cover gets applied in two ways: to everything or to nothing. When something goes wrong (which it inevitably does) chasing a payout across different carriers and different claims processes turns one bad delivery into a week of admin for your team.

So why is transit protection important? And how does Shippit help you exert more control and flexibility over the SKUs you protect?

Why is transit protection important?

If you ship large volumes, loss and damage are a question of ‘when’ rather than ‘if’.  Every damaged or missing parcel carries a chain of costs that far exceed the replacement item. That means a refund or reship, a support ticket, and even a customer who now shops with your competitor.

Transit protection exists to close that gap. It means a damaged or lost delivery is a quick and efficient claim rather than a drawn-out dispute with a carrier. Unfortunately, most protection today is rigid and one-size-fits-all. Businesses pay to protect the entire consignment: the $15 phone case as well as the $1,000 speaker. Or the cushion cover that’s travelling with a fragile mirror. It means you end up covering lots of stock that didn’t need it - or not covering stock that does need it. 

What is Shippit's transit protection offering?

Through Shippit's transit protection, built in partnership with FreightSafe, you only pay to protect what's actually worth protecting. Instead of blanket cover across every item in a consignment, it lets you set rules by SKU, value, or category. 

According to FreightSafe research, one in five claims account for 60% of total claims value. With SKU-level protection, high-value or fragile lines, glass, mirrors, electronics, premium goods, get the cover they need. While low-risk, low-value stock doesn't. The one-size-fits-all cover offered by most shipping platforms is costing you more than you think.

It also works the same way for every carrier. Rather than tracking what each carrier covers and following a different process for every claim and every carrier, it's one arrangement, one process, and one point of contact across your entire carrier mix.

Here’s how it works:

• Single portal, all carriers: Manage protection across every carrier from one place, with one invoice and full visibility, rather than juggling separate arrangements with each carrier.
• Higher coverage limits: Up to AUD$100,000 retail value (excluding GST) per domestic shipment, and AUD$50,000 (excluding GST) for international deliveries.
• Protect only what matters: Set rules by SKU, value, or category, so you're not paying to protect stock that doesn’t need it. 
• Fast claims, direct payouts: Claims can be submitted within minutes and are typically resolved within five business days; paid straight to your bank account, with no third-party portals or separate logins.
• Smarter risk control: Proactively track trends by carrier, route, region, and product to reduce damage and loss over time, rather than just responding to it.

As the regularity and severity of claims increases, transit protection could help brands  from absorbing a cost that doesn't need to exist. And that doesn’t account for the opportunity loss cost either. According to Shippit's State of Shipping Report, 68 percent of Australians might not return to a brand after a poor delivery experience. So how can you get started?

How do you get started with Shippit's transit protection?

Switching on our transit protection takes minutes, and it works across every carrier on Shippit's shipping platform, as well as your own carriers. That means you're not locked into a single provider to get the protection.

*Until 31 August 2026, Shippit is offering new Transit Protection customers 25% off their Transit Protection rate for the whole peak window: 1 September to 31 December 2026.

Loss and damage in transit isn't going away; and during peak, when volumes surge and delivery matters more, the stakes are higher than ever. The way you protect your parcels - and, by extension, your reputation - is a choice, not a given. 

To learn more about transit protection, visit the link: https://www.shippit.com/products/transit-protection 

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^{*Available to new Transit Protection customers activated between 4 and 31 August 2026. The 25% discount applies to your Transit Protection rate on orders protected between 1 September and 31 December 2026. Standard rates resume from 1 January 2027. View Transit Protection T&Cs here.}