Warehouse Insurance and Ways To Ensure Your Warehouse is Correctly Covered

Rohan Mathew

A warehouse is an important cog in the chain of supply of goods for many businesses. A warehouse is used to temporarily store goods/stock used in trade for a given business venture. To avoid interruption of business, savvy investors are advised to take insurance covers to protect the warehouse building itself, the stock to be stored in the warehouse, and personnel and equipment operating in the warehouse space. To ensure your warehouse is comprehensively covered it is important to recognize common sources of risks or threats in warehousing.


Fire is a common occurrence that can be caused by a malfunction of the electrical system in a building. In the unfortunate scenario of a fire outbreak, the stock, equipment, and workers are exposed to misfortune in that the business stock and equipment may be completely wiped out or damaged and thus impacting on business operations and profitability. There are insurance covers against fire where the business owner will be compensated when fire erupts in the warehouse and causes losses to the business owner


The best security system including CCTV surveillance and motion detectors are never a full-proof deterrence against theft of stock and equipment in a warehouse. It is logical for business owners to look for warehousing space in geographical locations they consider secure and crime-free. It is also prudent for a business owner to take cover against theft for stock or equipment stored in the warehouse. The insurer will compensate the business owner in the event a crime is established and business stock is stolen.

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Flooding and Damage to Goods during Loading and Uplifting

A blocked drainage system located in the vicinity of the warehouse can be the cause of loss of stock or damage to equipment stored in the warehouse. Water is harmful to electrical equipment and most of the general inventory. A warehouse owner can be advised to install storage shelves and electrical sockets way above the floor levels, however, it is also thoughtful to take a cover against flooding where the business is compensated for losses caused by flooding water.

It is also possible to ensure stock and equipment against physical damage during normal operations such as uplifting, loading, and offloading. There are types of business products that require special care and handling and are often damaged during loading or uplifting. In case of damage to such goods, warehouse insurance cover will compensate the business owner for such incidental losses.

A business owner can also take an insurance cover for goods in transit to the warehouse. The geographical location of a warehouse will directly impact on the risk exposure on the goods. A warehouse owner can be advised to seek cover if there are anticipated losses in the delivery goods to the warehouse. Losses on goods in transit are often occasioned by bad roads, heavy traffic, and bad weather among other logistical hurdles.

Insured warehouses prove more profitable in the long run compared to warehouses with no covers at all. Insurance covers on warehouses minimize interruptions of normal business operations when unforeseen/unavoidable perils occur to the detriment of the business. A business owner must identify an insurance company that will understand sources of risk for warehouses in different and in a specific line of business.