Factory and Warehouse Insurance

You’ve landed on the right page if you own a factory or warehouse. The factory and warehouses are essential in the industrial setup, as all the manufacturing and storage-related activities happen there. Imagine how great your loss will be if an accident occurs in your factory or warehouse. Those expensive machines and equipment breakages can make a big hole in your pocket. That is why there is factory and warehouse insurance.

The factory and warehouse insurance policy will cover all your contents and stocks against various risks like fire, implosion, explosion, and natural calamities. Read until the end to find out why factory and warehouse insurance is important to you.

What is Factory and Warehouse insurance?

Factory and warehouse insurance is an all-encompassing insurance policy that provides coverage for losses occurring due to any harm to the structure of the factory/warehouse. It also gives coverage for any loss of profits arising out of the damage. The insurance is designed to cover all your contents and stocks against risks like fire, implosion, explosion, and natural calamities. Other additional coverages like theft, burglary, electronic & mechanical breakdown, money insurance, and all-risk laptop insurance are also included.

Types of Factory and Warehouse Insurance

Factory and warehouse insurance coverage will depend on the type of policy you select to buy. Below is a list of all types of factory and warehouse insurance plans:

Builders’ risk insurance is also called Course of Construction (COC) insurance. This type of insurance gives coverage for buildings and other structures while they are under construction. The building can be residential or commercial.

General liability insurance is also termed Commercial General Liability Insurance (CGL). It is a class of insurance that offers liability protection to businesses for a range of damages like faulty workmanship, job-related injury, and advertising injury/defamation.

This aforementioned type is very useful to clients who frequently have their assets in different locations. This policy type is beneficial for distributors and C&F agents who have stocks at different locations.

This policy pays for the cost of the replacement/reinstatement of your insured asset and does not consider its depreciated value.

This policy gives coverage only up to a specific amount as decided by the insurer, which is generally less than the value of the property.

Why Do You Need Factory and Warehouse Insurance?

Running and maintaining a business involving the operations and activities of a warehouse and factory is difficult. It requires ensuring the safety of the workers and employees, along with the factory and warehouse space. However, there are still many businesses that often overlook the importance of securing their structure and assets with insurance.
Here are the reasons why you need a factory and warehouse insurance policy:

Covers a Wide Range of Risks : The factory and warehouse insurance policy covers a wide range of damages, like loss occurring due to lightning, fire, theft, burglary, earthquake, storm, flood, etc. In addition, coverage for this particular insurance can be enhanced by selecting add-ons.
Easy Documentation : The revocation of factory and warehouse insurance online requires the least amount of paperwork. You just have to put forward the fixed Asset Register maintained for your bookkeeping to get the insurance. The serial numbers are only needed for portable equipment.
Convenient to Lenders : A bank clause can be added to a stock insurance policy under factory and warehouse insurance online. Lenders get double the indemnity in the event of damage to mortgaged assets. Business interruption loss or loss of profit will compensate payable operating costs for periods of disruption and ensure regularly serviced debt.
Customized Cover : The customized factory and warehouse insurance plans offered online will fit your requirements in the best way possible. You will get instant assistance from the experts, who will suggest the best factory and warehouse insurance plans suitable for your business requirements.

What Will a Factory and Warehouse Policy Cover?

The factory and warehouse insurance policy offers coverage for all contents and stocks against various risks, such as:

Fire and Burglary : Getting fire cover without your own vehicle damage or debris removal excess is the best partial cover.
Industrial All Risk : All-risk means comprehensive damage coverage, excluding some specific risks. It has wider coverage and is made for high-value risks in complex manufacturing processes.
Electronics and Office Equipment : Assets like servers, laptops, A/Cs, and EPABX need specialized insurance. These assets are generally secured against short circuits, voltage fluctuations, thefts, and breakdowns.
Plant and Machinery : Manufacturing can grind to a halt because of breakdowns in critical machinery. Production delays, penalties, and loss of reputation can be daunting. You should have robust breakdown insurance to cover critical machinery.
Fidelity and Money Insurance : If an insider commits fraud, be it fraudulent wire transfers, incorrect bill payments, or forgery, the Fidelity cover helps recover losses.
Credit Insurance : All your production efforts can be in vain if the credit is not recovered or delayed. You may supply buyers with bad credit records or get exposed to an insolvent buyer. Credit insurance can protect you from credit losses.

What is Not Covered Under Factory and Warehouse Insurance?

There are always several items that are not covered under insurance. In the case of factory and warehouse insurance, the points that are not covered are:

Intentional damage to the property
Damage to the property due to illegal activities and consequential loss.
Normal wear and tear due to deterioration
Any damage due to war
Radioactive contamination and pollution

But this is just an inductive list, you can get more details about the exclusions once you get your policy wording.

How To File a Claim Under Factory and Warehouse Insurance?

To file a claim under factory and warehouse insurance, the following steps should be taken:

After the incident, intimate the claim as soon as possible to the insurance company
The insurance company will appoint a surveyor who will visit the affected site.
A claim will be submitted describing the incident, and you may be asked to submit an incident-related report like the FIR or the estimated cost of repair.
the surveyor will submit a report and the claim amount will be processed.

Summing Up!

Factory and warehouse insurance is a must-have for a company to secure its assets. Policy Wings is the best platform for you because here you can get factory and warehouse insurance from various companies, all in one place so that you can compare easily, and you will be provided with personal assistance to help you understand the policies so that you can make an informed decision.

Frequently Asked Questions

As per RIV policy, the claim is settled based on the latest cost of buying the asset again. Under the MV policy, the claim value is decided after deducting the depreciation value for the number of years the asset has been in use.

One of the major advantages of getting factory and warehouse insurance is that it is a single umbrella policy that covers many risks. Any bodily injury or property damage to a third party in your warehouse or factory can also be covered, along with other basic coverage, under the factory and warehouse insurance policy.

The premium rate of your factory insurance is calculated based on risk, which includes the location of the factory or plant, the history of past claim settlements, the size of the company, and the nature of the business. Along with this, the premium will also be charged on the add-ons that you select.