Warehouses And Storage Insurance FAQ

• At the minimum, warehouse and storage businesses need general liability insurance.
• If they have employees they will need workers compensation in most states.
• If they have vehicles registered to the business, or use vehicles for the business purposes, they will also need commercial auto.
• There are also other specialty coverages and endorsements that might be needed based on their operations.

The commercial package policy (CPP) is the most convenient and cost effective way to combine two or more coverages into a single policy. Warehousing operations are not usually eligible for coverage under a businessowners policy.

Types Of Warehouses And Storage Package Policies:

• Commercial Package Policy (CPP)

The property values are concentrated in the items defined as building, even though the items may appear to be business personal property. The actual business personal property values are low and generally limited to office items. The personal property of others is best covered with an inland marine coverage part.

Time element exposures are significant but, depending on the contracts, may be more about extra expense exposures than business income.

Types Of Property Coverages:

• Building
• Business Personal Property
• Personal Property of Others
• Improvements and Betterments

Warehouse legal liability is a bailee coverage form specifically designed for warehousing operations. Fine arts and commercial articles floaters and furriers customers coverage forms might also be needed for certain operations. Motor truck cargo forms are also needed if the operation provides merchandise pickup, delivery or other trucking services.

Types Of Inland Marine Coverages:

• Accounts Receivable Coverage
• Bailee Customers Coverage
• Commercial Articles Floaters
• Contractors Equipment Coverage
• Difference in Conditions (DIC) Coverage
• Electronic Data Processing Equipment Coverage
• Fine Arts Coverage
• Furriers Customers Coverage
• Furriers Customers Excess Legal Liability Coverage
• Motor Truck Cargo Legal Liability Coverage
• Signs Coverage
• Valuable Papers and Records Coverage
• Warehouse Legal Liability Coverage

Employee theft is the most important crime coverage issue. If employees pick up and deliver merchandise from customers' premises, a clients' property coverage endorsement should be considered. Other coverages may also be needed, depending on the types of property stored and the services provided.

Types Of Crime Coverages:

• Computer and Funds Transfer Fraud Coverage
• Employee Theft Coverage
• Forgery or Alteration Coverage
• Inside The Premises-Theft of Money and Securities Coverage
• Inside The Premises-Robbery or Safe Burglary of Other Property Coverage
• Money Orders and Counterfeit Money Coverage
• Outside The Premises Coverage

The promises made by warehouse operations often are backed by surety bonds because of the value of the contracts. In addition, other bonds may be required based on the property and the governmental entities with jurisdiction.

Types Of Surety Coverages:

• Contract-Performance of Service or Supply Bonds
• Court Bonds
• Fiduciary Bonds
• License and Permit Bonds
• Miscellaneous Surety Bonds

The liability hazards and exposures for warehouse operations are minimal because customer visits are infrequent and access is limited. However, mini-warehouses are different and have a much greater premises liability exposure.

If the operation has a railroad sidetrack or spur on the property, additional coverage in the form of a railroad protective policy may be needed.

Types Of Liability Coverages:

• Commercial General Liability (CGL) Coverage
• Employee Benefits Liability Coverage
• Employment-Related Practices Coverage
• Owners and Contractors Protective (OCP) Liability Coverage
• Railroad Protective Liability Coverage

Automobile exposures may be limited to hired and non-owned auto or, depending on the nature of the operations and services provided, the operation may have a much more significant trucking exposure.

Types Of Business Auto Coverages:

• Auto Medical Payments
• Business Auto Coverage
• Collision Coverage
• Comprehensive Coverage
• Federal Motor Carrier Safety Administration (FMCSA) Endorsements
• Hired & Non-owned Auto Coverage (HNOA)
• Intrastate Supervision
• Motor Carrier Coverage Form
• Public and Contract Carriers
• Uninsured/Underinsured Motorists Coverage

Automation in many warehouse operations has dramatically reduced the number of individuals employed but workers compensation exposure continues to exist so coverage is still required. If the warehouse is located in a coastal area or along navigable waters, and workers load and unload ships and other vessels, Longshore and Harbor Workers' Compensation Act coverage is also required.

Types Of Workers Comp Coverages:

• Excess Workers Compensation Self-Insurance Bonds
• Longshore and Harbor Workers' Compensation Act Coverage
• Stop-Gap or Employers Liability Coverage
• Workers Compensation and Employers Liability Coverage

While the premises and products liability loss exposures are very limited, the employers liability loss potential is high. The auto liability loss potential ranges from minor to severe, depending on the extent of the trucking operations and services provided.

Types Of Excess Liability Coverages:

• Excess Liability Coverage
• Umbrella Coverage

Depending on the unique features or peculiar characteristics of their operations, some wholesalers may have unusual exposures. One or more of the following coverages may be appropriate:

Types Of Specialty Coverages:

• Business Legal Expense Coverage
• Cyber Liability Coverage
• Directors and Officers Liability Coverage
• Environmental Impairment Liability Coverage
• Fiduciary Liability (Pension, Welfare and Employee Benefit Funds) Coverage
• Identity Theft Insurance
• Risk Retention Group Liability Coverage
• Solar Energy System Coverage
• Tax Liability Coverage
• Terrorism Insurance Coverage
• Transportation Brokers Contingent Cargo Coverage
• Underground Storage Tank (UST) Liability Coverage
• Unmanned Aerial Vehicles (UAV) (Drones)