When commercial warehouses store property for individuals and business, they take on a certain amount of risk. Accidents and negligent behaviors can happen in a warehouse that result in damage to property and people. These incidents leave the warehouse owner responsible for covering the cost of replacing damaged property or even life-long expenses related to serious injuries and death.
When you invest in a legal liability insurance plan, you safeguard your business against uncontrollable future costs that could literally wipe out your savings and force you to permanently pull down your dock doors. Additionally, wise business owners never leave their products and property in the care of a warehouse owner who fails to provide an appropriate level of financial protection against incidents. They need to know without any doubts that you can reimburse them in the event of losses.
With this guide, you can review everything you need to know about legal liability insurance plans. Use this information to help you make informed decisions about your insurance investment:
You can find a wide range of insurance plans for your various warehouse coverage needs. For example, insurers offer general liability coverage designed to handle common claims from employees, vendors and customers. You can also find building insurance that covers the cost of repairing or replacing areas of damage to the building from natural events like fire, flood and severe storms. Building insurance plans also usually cover theft, vandalism and even structural collapse.
One of the most important types of coverage for investment in the future of your business is content or inventory insurance. It covers damage to the inventory you store that's not covered by general liability or other plans. Transport or warehouse-to-warehouse insurance is also available and guarantees that you have protection for anything you transport from one warehouse to another. Lastly, legal liability plans cover a wide range of scenarios above and beyond the other coverage options.
You might also hear warehouse operator's legal liability insurance referred to as warehouse legal liability insurance. Although many insurers use these descriptions interchangeably and offer all coverage options for negligence-related incidents under one plan by that name, some divide liability coverage into two plans. If you're offered the second option, the insurer might refer to it standalone as warehouse legal liability insurance.
- "Warehouse legal liability insurance" covers a lot more scenarios in which there's no doubt that negligence by the warehouse, a failure to provide due or reasonable care to prevent an incident, caused an adverse event that triggered a claim.
It's especially useful when dealing with personal injury claims. For example, this type of insurance plan might cover expensive legal and other fees related to a claim by a visitor who experienced a serious injury while at your warehouse because you failed to maintain signage warning of potential fall hazards or an employee failed to maintain situational awareness and ran into them with equipment. This plan might also cover a data loss event, such as when a thief steals hard copy or electronically stored documents that contain private personal information about employees, vendors and others.
With either policy, an insurance agent might tell you that the plan also covers the cost of remediation services and cleanup of any debris or environmental toxins/pollution related to an incident. It might cover incidents related to missing property even when you have difficulty finding the person or persons responsible for the loss. Most importantly, some legal liability policies cover incidents of harm to property and people that occur because of acts by one or more employees that involve dishonesty, maliciousness or fraud.
The cost of a plan depends entirely on whether your insurance provider offers one or two plans and the terms and coverage within the plan or plans. Other factors that influence cost include the geographic location and size of the warehouse, the number of employees, the certifications held by employees in relation to safe handling of certain materials and the types of goods stored on-site and transported to other locations. For example, you might have to pay more for coverage if you store any type of flammable or hazardous materials, perishable goods or prescription drugs.
The contract you have with property owners about liability also influences the coverage you need and cost. In addition, an insurer might offer you customization options so that you can design the plan coverage areas to fit your specific, unique situation. Lastly, the dollar amount of coverage influences the monthly premium amount or yearly cost. As a result, some small warehouse operators, for example, can find plans for as low as $30 per month. Large warehouse operators can expect to pay more.
Although you should have at minimum general liability coverage for most common incidents, you need to consider extra plans to prevent massive financial losses related to incidents not covered by general liability. Warehouse operator's and warehouse legal liability plans help reduce worries and expenses related to valid damage and injury liability claims against you or others that involved acts of negligence. An experienced insurance agent can provide you with more detailed specifics about the coverage areas and related costs for a plan or plans available in your area. Call an agent today for more information or to schedule an appointment to set up a legal liability policy.