Petroleum Wholesaler Distributor Insurance Policy Information
Petroleum Wholesaler Distributor Insurance. Businesses and people in general rely on petroleum to operate their vehicles, heat their properties, and more. As one of the most reliable sources of fuel, petroleum is always in high demand.
Petroleum wholesalers receive petroleum products such as gasoline, diesel, fuel oil, and motor oil from refineries for distribution to retailers or other businesses. The product may come to the wholesaler by railroad tanker or truck and can be delivered in bulk or packaged into containers.
Bulk storage stations include tank fields with underground pipelines. The distribution center may be open 24 hours a day. Some wholesalers also own retail gasoline stations or convenience stores.
As a distributor or wholesaler of this product, you have a lot of responsibilities that need to be attended to. From ordering and delivering fuel to making sure that your employees are properly trained and all equipment is functioning properly, there's a lot of liability resting on your shoulders.
If anything goes wrong - damaged property, a petroleum spill, an injury - you'll be responsible for covering the cost of any necessary repairs, cleanup, medical bills, and so on. These costs can be prohibitive.
To avoid the crippling expenses that could potentially put your business in ruin, it's important that you invest in the right type of petroleum wholesaler distributor insurance coverage.
Petroleum 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 petroleum wholesaler & distributor insurance questions:
- How Much Does Petroleum Wholesaler Distributor Insurance Cost?
- Why Do Petroleum Wholesalers And Distributors Need Insurance?
- What Type Of Insurance Do Petroleum Wholesalers And Distributors Need?
How Much Does Petroleum Wholesaler Distributor Insurance Cost?
The average price of a standard $1,000,000/$2,000,000 General Liability Insurance policy for small petroleum wholesaler distributor businesses ranges from $87 to $129 per month based on location, size, revenue, claims history and more.
Why Do Petroleum Wholesalers And Distributors Need Insurance?
Though you try your best to make sure that everything concerning your business runs smoothly, you never know when you're going encounter a problem. Since you're liable for any issues that may arise, the cost of your financial obligations could be devestaing.
If you're properly insured, however, when you do run into trouble, you'll have the financial security you need to cover the expenses; instead of paying for repairs, medical bills, legal fees, etc on your own, your insurance will pay such expenses for you.
In other words, petroleum wholesaler distributor insurance can help you avoid financial devastation. Not only that, but certain types of insurance are legally required; furthermore, having insurance assures your clients, employees, and anyone else that you work with that should something go wrong, your business has the funds to cover the expenses.
What Type Of Insurance Do Petroleum Wholesalers And Distributors Need?
Every petroleum distributor is different, and therefore, their insurance needs will differ; however, there are some key types of petroleum wholesaler distributor insurance coverage that every business owner in this industry should carry, including:
- Pollution Liability: If there's ever an accident that leads to a petroleum spill, pollution liability insurance will cover the cost of any necessary cleanup, contamination disposal, as well any damages or injuries to a spill might cause to the environment or individuals.
- Commercial Auto: You'll also need to protect your commercial vehicles from any accidents that might occur. Commercial auto insurance will cover any damages to your commercial vehicles and injuries that drivers or passengers may sustain.
- Commercial General Liability: This policy covers third-party losses that are associated with physical injuries and property damages; for example, if a delivery driver damages a client's property, liability insurance would cover the repairs, any legal fees you may incur, and damages that a court might find you liable for.
- Business Interruption: If operations need to cease for any amount of time because of damages to your commercial property, for example, business interruption insurance will help to cover the income you may lose.
These are just some of the types of petroleum 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.
Petroleum Wholesale Distributor's Risks & Exposures
Premises liability exposures are limited due to the lack of public access to the storage facilities. If fuel is stored on the premises, fire, smoke, fumes, and vapors may spread to neighboring properties. There may be an attractive nuisance hazard with tank storage in the yard that must be controlled with fences and other barriers to prevent unauthorized access.
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.
Tanks, railroad tracks and conveyors can be attractive nuisances. The premises should be enclosed by fencing and other security to prevent vandals from entering the premises. "No Trespassing" signs should be posted.
Completed operations liability exposures are mainly due to misdelivery. The wrong fuel placed in a customer's tank has consequences ranging from inconvenience to tragedy as incorrect gasoline pumped into an airplane fuel tank will cause the plane to crash. The insured must have controls in place to monitor the fuels received from the refinery and delivered to customers.
Environmental impairment exposures are very high due to the possibility of tank leakage or spillage which can contaminate air, ground, or water. Spillage and leaking of pollutants can result in high cleanup costs and fines.
All tanks must meet EPA standards that include regular inspections and monitoring. Truck collisions and overturns can result in off-site environmental contamination. Drivers must be trained in and capable of performing needed and appropriate cleanup operations. If there are underground storage tanks, a UST policy will be needed.
Workers compensation exposures are high from the filling of tanks and trucks and the transport of petroleum. Fumes from the products can be toxic. There should be adequate ventilation, and safety equipment must be provided to employees. Employees can slip and fall due to product spills, or incur back injuries from lifting or dragging fuel hoses. Housekeeping is critical.
Drivers can sustain skin irritation and burns when loading and unloading. A driver can be seriously burned or killed if the vehicle overturns or explodes. Protective breathing equipment must be available for cleaning up leaks.
Drivers generally work alone, often after dark, and must operate in adverse traffic conditions such as inclement weather or road construction. Ergonomically designed seats can reduce back and leg injuries to drivers who sit in the same position for hours at a time. They must be monitored to ensure that an appropriate amount of time is allocated for sleep.
Property exposures can be very high. The petroleum distributor normally has extensive bulk storage facilities. Gasoline emits highly flammable fumes that must be controlled to prevent explosions. While underground tanks are the least prone to explosion, many tanks are above ground for environmental reasons.
Filling and dispensing fuel from the tanks can cause static electricity buildup that can lead to explosion unless the tanks are properly bonded and grounded. Petroleum products in containers for sale are less volatile as long as the containers are kept sealed and the temperature controlled.
Leak detection systems should be in place for tanks and other containers. Cleaning agents used to remove residue from tanks may be combustible. These must be properly labeled, stored, and separated. Greasy rags and equipment used to clean up spills could contribute to spontaneous combustion.
Smoking should be prohibited. Because electronic equipment and wiring can spark, it should be in conduit and maintained in excellent condition. Due to the high demand and cost of fuel, theft can be a problem. Alarms, guards, fencing and other security precautions must be in place as appropriate to the location.
Business income and extra expense exposures are high due to the lengthy time needed to rebuild the facility and install replacement tanks and equipment.
Equipment breakdown exposures include breakdown losses to the environmental control systems, electrical control panels, and other apparatus. Replacement parts may be difficult to obtain on a timely basis.
Inland marine exposures are 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' information. 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 to access and move stored items. Goods in transit are subject to theft and loss from collision or overturn, either of which could trigger an explosion if the transported goods are flammable.
Crime exposures are mainly from employee dishonesty. This operation involves a number of transactions and accounts that can be manipulated if duties are not separated. Background checks, including criminal history, should be performed on all employees handling money. 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. Most petroleum wholesalers use card lock systems for monitoring purposes. Physical inventories should be conducted at least annually.
Commercial auto exposures are high due to the delivery vehicles, which are large and awkward, and must be navigated over highways, rural winding roads, and congested city streets. Drivers must be trained in appropriate handling methods. They must have a valid commercial driver's license (CDL) for the trucks being driven and the cargo being moved.
MVRs must be run on a regular basis. Random drug and alcohol testing should be conducted. Multiple deliveries may be made during a single shift. Tankers often have compartments so that many different types of fuel can be loaded onto a single vehicle.
Drivers are responsible for loading and unloading the correct fuel into the tankers and at the customer's premises. Vehicles must be well maintained, with records kept in central locations.
Commercial Insurance And Business Industry Classification
- SIC CODE: 5171 Petroleum Bulk Stations And Terminals, 5172 Petroleum And Petroleum Products Wholesalers, Except Bulk Stations And Terminals
- NAICS CODE: 423220 Home Furnishings Merchant Wholesalers
- Suggested ISO General Liability Code(s): 12797 Floor Covering Distributors
- Suggested Workers Compensation Code(s): 8018 Store - Wholesale - NOC
Description for 5171: Petroleum Bulk Stations And Terminals
Division F: Wholesale Trade | Major Group 51: Wholesale Trade-non-durable Goods | Industry Group 517: Petroleum And Petroleum Products
5171 Petroleum Bulk Stations And Terminals: Establishments primarily engaged in the wholesale distribution of crude petroleum and petroleum products, including liquefied petroleum gas, from bulk liquid storage facilities.
- Petroleum bulk stations and terminals-wholesale
Description for 5172: Petroleum And Petroleum Products Wholesalers, Except Bulk Stations And Terminals
Division F: Wholesale Trade | Major Group 51: Wholesale Trade-non-durable Goods | Industry Group 517: Petroleum And Petroleum Products
5172 Petroleum And Petroleum Products Wholesalers, Except Bulk Stations And Terminals: Establishments primarily engaged in the wholesale distribution of petroleum and petroleum products, except those with bulk liquid storage facilities. Included are packaged and bottled petroleum products distributors, truck jobbers, and others marketing petroleum and its products at wholesale, but without bulk liquid storage facilities.
- Butane gas, except bulk stations and terminals-wholesale
- Crude oil, except bulk stations and terminals-wholesale
- Fuel oil, except bulk stations and terminals-wholesale
- Fueling services, aircraft-wholesale
- Gases, liquefied petroleum: except bulk stations and
- Gasoline, except bulk stations and terminals-wholesale
- Gasoline: buying in bulk and selling to farmers-wholesale
- Lubricating oils and greases-wholesale
- Naphtha, except bulk stations and terminals-wholesale
- Petroleum and its products, except bulk stations and
- Petroleum brokers-wholesale
Petroleum Wholesaler Distributor Insurance - The Bottom Line
Not all petroleum wholesaler distributor insurance polices have the same limits, exclusions and coverages. If you are shopping for commercial insurance, or want makre sur your policy fully protects your operations, 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.