A Guide to the Return Shipping Protection Program

As return shipping costs are fully shifted to sellers, sellers can opt in for the Return Shipping Protection Program. This protection program helps you manage financial risks from return shipping fees and unsellable returned items. By paying a small fee per order, you can convert unpredictable losses from returns into a stable, predictable operating cost, protecting your business and improving cost fairness. While this protection is available for all sellers to opt-in, it is most beneficial for sellers with high return rates and/or high Average Order Value, as it significantly reduces exposure to volatile return-related costs.

Learning Objectives

After this course, you will be able to:

• Understand what Return Shipping Protection Program is and why it is beneficial.
• Identify what is covered through the Return Shipping Protection Program, including return shipping fees and item value loss.
• Understand the pricing model and how fees are calculated.
• Learn how to enroll in the program and how to file a claim for a covered incident.
• Recognize which types of claims are processed automatically versus those that require manual submission.

What it is and Why it Matters

What is it?It is an optional Return Shipping Protection Program designed to protect sellers from unpredictable costs associated with returns. It covers two main costs: the return shipping fee and the value of the item. This applies if items are lost, stolen, or damaged during the return for buyer-fault or platform-fault cases.
Why it matters:Returns are part of doing business — but when items come back damaged, lost, or unsellable, the financial impact falls on sellers. The Return Shipping Protection Program gives you a predictable safety net. It turns one-off losses into a stable, foreseeable cost, so you can plan with confidence and focus on growing your store.

How it Works

Coverage Scope

The Return Shipping Protection Program provides coverage for the following scenarios, with a maximum liability of $15,000 USD per order:

• Return Shipping Fee: Covers fees for both buyer-fault (for example, change of mind) and seller-fault returns.
• Item Value: Covers the value of the item in cases of:
  • Damage during return transit
  • Lost or stolen parcels during return transit
  • Undelivered returns, where the item is marked as returned but you did not receive it.

Exclusions:The Return Shipping Protection Program does not cover:

• Refund without return
• Cases where the buyer fails to drop off the return parcel
• Returns to overseas warehouses
• Item value loss due to seller fault

Pricing Model

Sellers who opt-in will pay a fee for each covered order.

• Fee rate: The fee is calculated as a % of the order's Total Covered Order Value (TCOV).
  • Return Logistics: 1.5% of TCOV (covers return shipping fee, loss, damage, and undelivered returns.
• Total Covered Order Value (TCOV): This is the maximum claimable value for an order. It is calculated as: Actual buyer paid amount + platform subsidy - tax.

Claims and Compensation

• Automatic Claims: Claims for return shipping fees are typically processed automatically once the return parcel is shipped by the buyer and meets the criteria.
• Manual Claims: For incidents like item damage or undelivered returns, sellers must submit a claim manually through Seller Center.
• Evidence: Manual claims may require supporting evidence. For example, claims for damaged goods require clear photos of the damaged product and its packaging. Claims submitted without the necessary evidence may be denied.
• Payout: Once a claim is approved, the compensation is automatically paid to the seller's pre-settled account (a temporary holding account for funds before final settlement).

How to Access

How to Enroll

1. Go to the Manage returns page in Seller Center
2. Find the enrollment section
3. Review and agree to the Terms & Conditions
4. Your enrollment is complete - coverage starts immediately

• Participation is optional, and sellers can opt-in or opt-out as needed.

How to Submit a Claim

• Submit claims from the Manage returns and refunds page in Seller Center.
• Claims are processed in two ways depending on the claim type:
  • Auto Claims: Return shipping fee claims are processed automatically once a return is initiated and meets the eligibility criteria. No action needed by sellers.
  • Seller-Initiated Claims: For cases involving undelivered returns, damage, or loss, have the following ready before submitting: clear photos of the product and packaging

How to See Your Claims

• To view your claims activity
  • Go to the Manage Return page and you will be able to see the status of submitted claims.
  • Or log in to Seller Center and go to Fulfillment > Return Settings, or enter from Manage Orders > Returns

Frequently Asked Questions (FAQs)

Is Return Shipping Protection Program mandatory for sellers?

No, participation is completely optional. Sellers can choose to opt-in or opt-out based on their business needs.

How is the fee calculated?

The fee is calculated as a percentage of the Total Covered Order Value (TCOV), which includes the item's selling price after promotions plus shipping fees. For example, if your TCOV is $100 and you choose return coverage (1.5%), your fee would be $1.50.

What is the maximum coverage per order?

The maximum liability is capped at $15,000 USD per order. Please note, the Return Shipping Fee maximum is capped at $20 USD.

What are the benefits of using the Return Shipping Protection Program?

By activating the protection program, sellers can enjoy the following benefits:

• Affordable service fee:
  • Pay only 1% of Total Covered Order Value (TCOV) including tax per package for Seller Forward Shipping Protection Program.
  • Pay only 1.5% of Total Covered Order Value (TCOV)) including tax per package for Seller Return Shipping Protection Program.
• Automatic reimbursements: TCOV for affected orders is automatically adjusted by the system for abnormal logistics statuses.
• Always in your control: Opt in or out any time.

How do I enroll/opt-in for the Return Shipping Protection Program ?

Sellers can enroll/opt-in for the Return Shipping Protection Program through the Manage returns page in Seller Center on desktop. Once activated, the program will automatically apply to all eligible packages after you receive confirmation of successful enrollment.

How do I obtain billing and tax invoices for the shipping protection program?

You can access billing and tax invoices (including administration fees, service fees, and seller payment fees) for the period you are enrolled in the Return Shipping Protection Program in Seller Center invoices, under platform fees. Note that the reimbursements will not be included in invoices and will only be shown in transaction details.

What happens if an order is split into multiple packages?

If one order is split into multiple packages, the service fee will be charged per package, not per order. For example:

• If 2 packages are delivered, you will be charged 2 service fees.
• If only 1 package is delivered, you will be charged one service fee.

Please note: Compensation is limited to the amount paid for items in the affected package. Claims can only be submitted after the sellers have been charged for Total Covered Order Value (TCOV).

Are partial cancellations or partial fulfillment covered?

Partial cancellation occurs when sellers receive orders with multiple SKUs and items, but some SKUs may be low in stock or out of stock, making it challenging to fulfill all items.

If partial cancellations occur because the seller could not fulfill the order, then...

• A service fee will be charged per package
• Compensation for the items in the package will be based on the item value
• Claims can only be submitted after sellers get charged for TCOV.

Does the Return Shipping Protection Program cover seller-fault returns?

Yes, return shipping fees for both buyer-fault and seller-fault scenarios are covered. However, item value loss is only covered in non-seller fault cases.

What is NOT covered under the Return Shipping Protection Program?

The following are excluded from coverage:

• Refund without return
• Cases where buyer fails to drop off the return parcel
• Returns to overseas warehouses
• Item value loss for seller-fault cases

How do I file a claim for return shipping fees?

Return shipping fee claims are processed automatically once the buyer drops off the return parcel.

How do I file a claim for damaged/lost items?

For undelivered returns, theft, or damaged return items, you will need to submit a claim via Seller Center with supporting evidence (photos, police reports for theft, etc.).

How long does claim processing take?

Auto claims are processed immediately. Seller-initiated claims are reviewed within 1 business day.

Where can I see my compensation?

Compensation is automatically transferred to your pre-settled account.

Where can I track my Return Shipping Protection history and claims?

You can view eligible orders, reimbursement requests, and claim history through the Protection Dashboard in Seller Center.

Can I submit claims for orders from last year?

No. You may file a claim no later than 60 days from the order creation date for the Forward Shipping Protection Program and 90 days for the Return Shipping Protection Program.