Drugs Wholesaler Distributor Insurance Policy Information
Drugs Wholesaler Distributor Insurance. Prescription and over-the-counter drugs are essential for so many people. From treating chronic illnesses to keeping symptoms that are related to common ailments at bay, there are so many types of prescription drugs available that people rely on.
As a drugs distributor or wholesaler, your job is to supply the medications that the general public and facilities - like hospitals, pharmacies, and other institutions - require.
Drug wholesalers receive brand-name and generic pharmaceuticals from foreign or domestic manufacturers, usually by truck, for distribution to clinics, doctors, drug stores, hospitals, and other medical facilities. The wholesaler may also stock over-the-counter medications, vitamins, and other health-related items.
The distribution center may be open 24 hours a day. Generally, the product is delivered to the customer on the distributor's vehicles.
Working with drugs involves a lot of risk; so does running a business, in general. There are several liabilities that you could face, and it's important that you protect yourself from these liabilities so that you can assure the safety of your livelihood, your employees, and the people you serve.
What's the best way to do that? - By making sure that you have the right drugs wholesaler distributor insurance.
Drugs wholesaler distributor insurance protects your business from lawsuits with rates as low as $87/mo. Get a fast quote and your certificate of insurance now.
Below are some answers to commonly asked drugs wholesaler & distributor insurance questions:
- How Much Does Drugs Wholesaler Distributor Insurance Cost?
- Why Do Drugs Wholesalers And Distributors Need Insurance?
- What Type Of Insurance Do Drugs Wholesalers And Distributors Need?
How Much Does Drugs Wholesaler Distributor Insurance Cost?
The average price of a standard $1,000,000/$2,000,000 General Liability Insurance policy for small drugs wholesaler distributor businesses ranges from $87 to $129 per month based on location, size, revenue, claims history and more.
Why Do Drugs Wholesalers And Distributors Need Insurance?
Despite your attempts to ensure the best possible services, the safest work environment, and the safest products, things can - and do - go wrong. A vendor could trip and fall while making a delivery. An employee could sustain an injury while working.
A client could sue you, stating that the products you supplied caused injuries. A pipe could burst in your facility and cause extensive damage. These are just some of the issues that could arise.
The cost of repairs, medical bills, and any legal fees that may be associated with the above-mentioned situations could be exorbitant. Having to cover those expenses yourself could put you in a serious financial predicament.
If you are properly insured, however, instead of having to pay for those expenses yourself, your insurance company would help to cover the expenses. Drugs wholesaler distributor insurance serves as a form of financial protection.
What Type Of Insurance Do Drugs Wholesalers And Distributors Need?
There are several types of drugs wholesaler distributor insurance coverage that should be considered.
Some of the most basic policies, however, include the following:
- Product Liability: If a client files a lawsuit against your company, citing that a medication you provided caused an injury, product liability insurance would help to cover the related legal expenses and damages that you may be liable for.
- General Liability: You'll also need to carry general liability insurance, which covers third-party injury and property damage claims. Should a vendor slip and fall while making a delivery, this insurance will cover the related medical expenses, as well as any legal fees that may arise if the individual files a lawsuit.
- Workers Compensation: This type of coverage will help to cover medical expenses and lost wages should an employee sustain a work-related injury or illness. For example, if a piece of equipment malfunctions and injures a staff member, workers' comp will assist with the related costs.
- Commercial Property: If your warehouse is damaged in a fire or a storm, if a pipe burst, or if a vandal damages your building and steals any inventory, commercial property insurance will help to cover the expenses.
These are just some of the types of drugs wholesaler distributor insurance coverage you should carry. You can carry individual policies, or opt for a commercial package policy that combines several different types of coverage under a single policy.
Drugs Wholesale Distributor's Risks & Exposures
Premises liability exposure is limited due to the lack of public access to the storage facilities. Customers should be confined to specific areas that are kept clean, dry and free of obstacles. Parking lots and sidewalks need to be in good repair with snow and ice removed, and generally level and free of exposure to slips and falls.
If customers pick up goods, loading docks must be clearly marked and user-friendly. There should be a disaster plan in place for unexpected emergencies. Contracts with transportation and storage providers may expose the operation to additional liability.
Railroad sidetrack agreements pose additional concerns. If there is a railroad sidetrack or dock, an employee must verify that no one is in the path of an incoming or outgoing train. Railroad tracks and conveyors can be attractive nuisances. The premises should be enclosed by fencing with "No Trespassing" signs posted.
Products liability exposure is very high as any entity within the chain of control of the product can and most likely will be involved in any lawsuit filed. The exposure increases if the wholesaler repackages or relabels the drugs or imports goods from foreign manufacturers.
Bodily injury can result from tampering or poisoning, improper handling, contamination, improper labeling, or combination of ingredients. All products should be dated and stored as required by the manufacturer and marked for easy access in case of a recall.
Environmental impairment exposure is high due to the potential for air, land, or water pollution from the leakage of refrigerants used to keep some pharmaceuticals fresh. All underground tanks and pipes should be routinely tested for leakage.
Spill procedures must be in place to prevent the accidental discharge of contaminants. Improper disposal of pharmaceuticals can contaminate air, ground, or water. Record keeping is critical. Contracts should be in place to dispose of all environmentally dangerous chemicals.
Workers compensation exposure is very high. Lifting injuries such as back pain, hernias, sprains, and strains are common. Workers should be trained in proper lifting techniques and to use conveyances. Shelving must be stable to prevent stored goods from falling onto workers. Forklift operators must be properly trained.
Leaking of refrigerants is a serious health hazard that can lead to lung damage or even death. Protective breathing equipment must be available to all workers in the event of any ammonia leak. Continual standing can result in musculoskeletal disorders of the back, legs, or feet. Floor coverings or coatings may pose slip and fall hazards.
Housekeeping is critical. When work is done on computers, employees are exposed to eyestrain, neck strain, and repetitive motion injuries including carpal tunnel syndrome. Cleaning workers can develop respiratory ailments or contact dermatitis from working with chemicals.
Drivers of delivery vehicles may be confronted by robbers, injured in automobile accidents, or be injured at customers' premises. Training must be provided on dealing with such situations, and any necessary security should be provided.
Property exposure is high due to multiple ignition sources, open construction, the combustibility of packaging materials, and the damageability of the stock. Ignition sources include electrical wiring and equipment, particularly refrigeration equipment, and heating and air conditioning systems.
All wiring must be well maintained and up to code for the occupancy. Pharmaceuticals are particularly vulnerable to loss by fire, smoke, and water. Even a small loss will result in all stock being condemned by the FDA due to possible contamination.
Items requiring temperature controls are subject to spoilage. Coolers and refrigeration units must be well maintained and replaced once they are no longer effective. Maintenance should be done on a regular basis with records retained.
Alarms should be in place to warn of power outage or shutdown. Backup generators should be available. Good housekeeping and fire controls are critical. Smoking should be prohibited. If there is a sprinkler system, heads must be located high enough to avoid accidental contact with forklifts.
Recharging of forklifts and maintenance of vehicles should be done in a separate, ventilated area away from combustibles. Drugs, particularly narcotics, are a target for thieves. Adequate security systems must be in place including alarms, security guards, lighting, and fences as appropriate for the location.
Business income and extra expense exposures are high. Recovering from a loss could require a lengthy time to rebuild the facility and purchase replacement refrigeration equipment. Business income from dependent properties is a concern since many drug distributors work with only one manufacturer.
Equipment breakdown exposures are high as temperatures must remain constant for refrigeration equipment. All equipment must be inspected and maintained on a regular basis. Back-up generators should be available. Additional coverage for spoilage and ammonia contamination should be considered as even a small power interruption could result in a large loss if drug products should spoil.
Inland marine exposure is from accounts receivable if the distributor offers credit to customers, computers for tracking inventory, contractors' equipment, goods in transit, and valuable papers and records for manufacturers' and customers' records. Duplicates must be kept of all data to permit easy replication in the event of a loss.
Contractors' equipment includes forklifts and hand trucks used for moving stored items. While goods may come to the warehouse via contract, common carriers or trains, goods are generally delivered to retailers on trucks owned by the distributor.
Goods in transit may be damaged by a collision or overturn. Due to the potential for theft, vehicles should be unmarked, have alarms, and be attended at all times. Sales representatives may carry sample stock to retailers.
Crime exposure is from employee dishonesty. Background checks, including criminal history, should be performed on all employees handling money. Warehouse operations involve a number of transactions and accounts that can be manipulated if duties are not separated.
There must be a separation of duties between persons handling deposits and disbursements and reconciling bank statements. Regular audits, both internal and external, are important in order to prevent employee theft of accounts.
Certain pharmaceuticals, particularly narcotics, are attractive because of their high street value. Good security systems should be in place to discourage employee theft. Physical inventories should be conducted at least annually.
Commercial auto exposure is moderate for the salespersons' fleet and delivery vehicles. There should be written policies on personal and permissive use of any vehicles provided to employees. All drivers must be well trained and have valid licenses for the type of vehicle being driven
MVRs must be run on a regular basis. Random drug and alcohol testing should be conducted. Vehicles must be well maintained, including refrigeration systems, with records kept in a central location.
Commercial Insurance And Business Industry Classification
- SIC CODE: 5122 Drugs, Drug Proprietaries, And Druggists' Sundries
- NAICS CODE: 424210 Drugs and Druggists' Sundries Merchant Wholesalers
- Suggested ISO General Liability Code(s): 12373
- Suggested Workers Compensation Code(s): 8047
Description for 5122: Drugs, Drug Proprietaries, And Druggists' Sundries
Division F: Wholesale Trade | Major Group 51: Wholesale Trade-non-durable Goods | Industry Group 512: Drugs, Drug Proprietaries, And Druggists' Sundries
5122 Drugs, Drug Proprietaries, And Druggists' Sundries: Establishments primarily engaged in the wholesale distribution of prescription drugs, proprietary drugs, druggists' sundries, and toiletries. Establishments primarily engaged in the wholesale distribution of surgical, dental, and hospital equipment are classified in Industry 5047.
- Biologicals and allied products-wholesale
- Blood plasma-wholesale
- Drug proprietaries-wholesale
- Druggists' sundries-wholesale
- Hair preparations-wholesale
- Medical rubber goods-wholesale
- Medicinals and botanicals-wholesale
- Medicine cabinet sundries-wholesale
- Patent medicines-wholesale
- Proprietary (patent) medicines-wholesale
- Razor blades-wholesale
- Razors, nonelectric-wholesale
- Toilet articles-wholesale
- Toilet preparations-wholesale
- Toilet soap-wholesale
- Toothbrushes, except electric-wholesale
Drugs Wholesaler Distributor Insurance - The Bottom Line
Drugs wholesaler distributor insurance polices can differ widely in both cost and coverage. If you are shopping for business insurance, or want to see if you have the right fit coverage, speak to an experienced broker to take a look at your business.
In many cases they can save you premium dollars and offer you better policy options than you currently have.
Types Of Small Business Insurance - Requirements & Regulations
Perhaps you have the next great idea for a product or service that you know will appeal to your local area. If you've got a business, you've got risks. Unexpected events and lawsuits can wipe out a business quickly, wasting all the time and money you've invested.
Operating a business is challenging enough without having to worry about suffering a significant financial loss due to unforeseen and unplanned circumstances. Small business insurance can protect your company from some of the more common losses experienced by business owners, such as property damage, business interruption, theft, liability, and employee injury.
Purchasing the appropriate commercial insurance coverage can make the difference between going out of business after a loss or recovering with minimal business interruption and financial impairment to your company's operations.
Insurance is so important to proper business function that both federal governments and state governments require companies to carry certain types. Thus, being properly insured also helps you protect your company by protecting it from government fines and penalties.
Small Business Insurance Information
In the business world, there are many risks faced by company's every day. The best way that business owners can protect themselves from these perils is by carrying the right insurance coverage.
The The National Association of Insurance Commissioners (NAIC) is the U.S. standard-setting and regulatory support organization. Through the NAIC, state insurance regulators establish standards and best practices, conduct peer review, and coordinate their regulatory oversight.
Commercial insurance is particularly important for small business owners, as they stand to lose a lot more. Should a situation arise - a lawsuit, property damage, theft, etc. - small business owners could end up facing serious financial turmoil.
According to the SBA, having the right insurance plan in place can help you avoid major pitfalls. Your business insurance should offer coverage for all of your assets. It should also include liability and casual coverage.
Types Of Small Business Insurance
Choosing the right type of coverage is absolutely vital. You've got plenty of options. Some you'll need. Some you won't. You should know what's available. Once you look over your options you'll need to conduct a thorough risk assessment. As you evaluate each type of insurance, ask yourself:
- What type of business am I running?
- What are common risks associated with this industry?
- Does this type of insurance cover a situation that could feasibly arise during the normal course of doing business?
- Does my state require me to carry this type of insurance?
- Does my lender or do any of my investors require me to carry this type of policy?
A licensed insurance agent or broker in your state can help you determine what kinds of coverages are prudent for your business types. If you find one licensed to sell multiple policies from multiple companies (independent agents) that person can often help you get the best insurance rates, too. Following is some information on some of the most common small business insurance policies:
|Business Insurance Policy Type||What Is Covered?|
|General Liability Insurance||What is covered under commercial general liability insurance? It steps in to pay claims when you lose a lawsuit with an injured customer, employee, or vendor. The injury could be physical, or it could be a financial loss based on advertising practices.|
|Workers Compensation Insurance||What is covered under workers compensation insurance? This type of insurance protects a business and its owner(s) from claims by employees who suffer a work-related injury, illness or disease. Workers comp typically provides the injured employee with benefits to cover medical expenses, a portion of his/her lost wages, rehabilitation costs if applicable, and permanent partial or permanent total disability.|
|Product Liability Insurance||What is covered under product liability insurance? I pays an injured party's settlement or lawsuit claim arising from a defective product. These are usually caused by design defects, manufacturing defects, or a failure to provide adequate warning or instructions as to how to safely use the product.|
|Commercial Property Insurance||What is covered under business property insurance? General liability policies don't cover damages to your business property. That's what commercial property insurance is for. It protects all of the physical parts of your business: your building, your inventory, and your equipment, giving you the funds you need to replace them in the event of a disaster. If you work from home, you might consider a Home Based Business Insurance policy instead.|
|Business Owners Policy (BOP)||What is covered under a business owners policy (BOP)? This is a policy designed for small, low-risk businesses. It simplifies the basic insurance purchase process by combining general liability policies with business income and commercial property insurance.|
|Commercial Auto Insurance||What is covered under business auto insurance? This type of insurance covers automobiles being used for business purposes. This could include a fleet of business-only vehicles or a single company car. In some cases it might cover your car or your employee's car while they're being used for business. These policies have much higher limits, ensuring you can cover your costs if one of these vehicles gets into an accident.|
|Commercial Umbrella Policies||What is covered under commercial umbrella insurance? This type of policy is a sort of "gap" insurance. It covers your liability in the event that a court verdict or settlement exceeds your general liability policy limits.|
|Liquor Liability Insurance||What is covered under liquor liability insurance? It covers bodily injury or property damage caused by an intoxicated person who was served liquor by the policy holder.|
|Professional Liability (Errors & Omissions)||What is covered under professional liability insurance? This type of business insurance is also known as malpractice oe E&O. It covers the damages that can arise from major mistakes, especially in high-stakes professions where mistakes can be devastating.|
|Surety Bond||What is covered under surety bonds? Bonding is a contract where one party, the SURETY (who assures the obligee that the principal can perform the task), guarantees the performance of certain obligations of a second party, the PRINCIPAL (the contractor or business who will perform the contractual obligation), to a third party, the OBLIGEE (the project owner who is the recipient of an obligation).|
Who Needs General Liability Insurance? - Virtually every business. A single lawsuit or settlement could bankrupt your business five times over. You might also need this policy to win business. Many companies and government agencies won't do business with your company until you can produce proof that you've obtained one of these policies.
Business Insurance Required by Law
If you have any employees most states will require you to carry worker's compensation and unemployment insurance. Some states require you to insure yourself even if you are the only employee working in the business.
Your insurance agent can help you check applicable state laws so you can bring your business into compliance.
Other Types Of Small Business Insurance
There are dozens of other, more specialized forms of small business insurance capable of covering specific problems and risks. These forms of insurance include:
- Business Interruption Insurance
- Commercial Flood Insurance
- Contractor's Insurance
- Cyber Liability
- Data Breach
- Directors and Officers
- Employment Practices Liability
- Environmental or Pollution Liability
- Management Liability
- Sexual Misconduct Liability
Whether you need any or all of these policies will depend on the results of your risk assessment. For example, you probably don't need an environmental or pollution policy if you're running an IT company out of a leased office, but you would need data breach and cyber liability policies to fully protect your business.
Also learn about small business insurance requirements for general liability, business property, commercial auto & workers compensation including small business commercial insurance costs. Call us (855) 767-7828.
Additional Resources For Wholesale And Distribution Insurance
Read informative articles on wholesale distribution insurance. Distributors and wholesalers face specific risks including fire, flood and weather damage that can destroy products in the distribution center - and every part of the supply chain including late supplier shipments to unpaid invoices - can effect the entire operation.
- Air Conditioning And Heating
- Audio And Video Equipment
- Beer & Ale
- Cameras & Musical Instruments
- CDs, DVDs And Videos
- Dairy Products
- Dry Goods
- Electrical Appliances
- Electrical Equipment
- Electrical Supplies
- Electronic Equipment
- Greeting Cards
- Importer & Exporter
- Liquor Wholesaler
- Manufacturers Representative
- Motion Picture
- Plate Glass
- Plumbing Supplies
- Restaurant Equipment
- Roofing Materials
- Seed Merchants
- Theatrical Supplies
- Wholesale Florist
- Wholesaler Distributor
Wholesale and distribution operations have many of the same physical damage and property coverage concerns as warehouse operations. In both, the value of both real property and stocks of merchandise is very high. Loss control and other techniques appropriate to the types of merchandise involved are needed. For these reasons, adequate and appropriate property insurance coverages are important.
Managing inventories, equipment and facilities can expose your wholesale distribution operations to some specific and unique risks.
The commercial auto exposure can also be significant, based on the extent of merchandise delivery. In addition, transportation or motor truck cargo insurance on the merchandise must also be arranged.
Employee theft is always an issue and can be a significant exposure, depending on the type of property involved. Finally, the types of merchandise and material handled makes workers compensation insurance another very important coverage.
Minimum recommended small business insurance coverage: Business Personal Property, Business Income and Extra Expense, Accounts Receivable, Computers, Contractors' Equipment, Goods in Transit, Valuable Papers and Records, Employee Dishonesty, General Liability, Employee Benefits, Umbrella, Business Automobile Liability and Physical Damage, Hired and Non-owned Auto & Workers Compensation
Other commercial insurance policies to consider: Building, Earthquake, Equipment Breakdown, Flood, Leasehold Interest, Real Property Legal Liability, Signs, Computer Fraud, Forgery, Money and Securities, Cyberliability, Employment-Related Practices and Stop Gap Liability.