Commercial warehouse insurance is a business insurance policy designed to protect warehouse businesses. When clients trust your warehouse with their products, they want to ensure that everything is kept safe and that there is no possibility of them losing their investment.
This is why having adequate warehouse insurance coverage is crucial because it reassures that you have the proper measures if trouble happens. In fact, most clients won’t even consider working with your business until they have the assurance that their investment is safe and secure within your walls.
Below, we’ll discuss some of the most common types of warehouse insurance that you’ll need to consider for your business and why you might need them. Then, we’ll give you a brief overview of what to expect as far as costs go and review a few of the top warehouse insurance companies on the market. Get ready to store away some information!
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On the surface, running a warehouse may seem like an easy business. You just have to buy a big building, install some shelves and racks, and then hire some workers, right?
Running a warehouse business is actually a bit more complex than that. As a warehouse business, you’ll likely be responsible for dealing with other businesses’ products, which means that there’s a lot of financial liability that you’ll be on the line for if you or your employees make any mistakes. This is why insurance for warehouse storage businesses is so important.
Without proper warehouse business insurance coverage, then you could be left on the line for tens or even hundreds of thousands of dollars worth of products if stacks of items are dropped, equipment causes property damage or personal injuries, a negligent employee crashes a forklift into a shelf, a fire breaks out, or somebody forgets to lock the door and products are stolen.
That said, different things could go wrong inside a commercial warehouse, so we’ll take a few minutes to look at the various types of warehouse insurance that will be useful.
Liability insurance protects your warehouse from claims made by third parties. This has many types. For warehouse businesses like yours, the liability insurance most companies offer is general liability insurance.
Warehouse general liability insurance is designed to protect you from claims that will come from vendors, visitors, clients, and other third parties. The language of general liability insurance includes these perils:
Third-party bodily injuries - An employee is working to stack items in the warehouse. The stack of items suddenly tumbled and fell. A client was walking by and got buried in the pile of items, thereby sustaining a concussion. General liability insurance will pay for medical expenses if the injured client files a claim
Third-party property damage - The cargo van of a logistics company is parked outside your warehouse. Your employee while driving a forklift lost control and crashed into the cargo van. If the logistics company demand payments for the damage the cargo van incurred, general liability insurance will pay on your behalf
You should know that aside from paying the amount aggrieved parties want. General liability insurance also takes care of attorney fees and other legal costs if legal action is taken.
Personal injuries and property damage aren’t the only perils general liability insurance covers. General liability insurance will also take care of advertising or reputational harm through its advertising injury coverage. Advertising injury coverage will cover attorney fees, other legal costs, and compensatory payments if a third-party files a claim against your warehouse for slander, libel, and reputational harm.
Rented premises liability coverage is another add-on to general liability insurance. Its job is to help a renter reimburse the losses of the property owner if fire damages a rented or leased space. Consider adding rented premises liability coverage if you’re renting a building to accommodate more items from clients.
Read more about commercial general liability insurance
Warehouse legal liability coverage, also known as warehouseman legal liability insurance and warehouse keepers liability insurance, will provide protection if the items of clients inside your warehouse get damaged because of fire, theft, vandalism, and other covered perils.
Warehouse legal liability insurance excludes coverage for items that were damaged to spoilage or expiry. But still, you can include this exposure in the policy’s terms by getting spoilage endorsements.
Warehouses are large structures and are often very expensive. Your warehouse building might get damaged or destroyed, and you’ll surely experience significant losses or might even be forced to stop doing business. And so, get warehouse property insurance because it will ensure that the building is protected against anything that could possibly happen to it.
So how does warehouse commercial property insurance help? Commercial property insurance has two primary functions:
Reimburse losses if fire or extreme weather destroys your warehouse’s building. The amount of reimbursement you’ll receive is equal to the building’s current market value or original market value
Reimburse losses if fire, extreme weather, theft, vandalism, and other covered perils damaged your warehouse’s building. The amount of reimbursement you’ll receive is equal to the value of the damage incurred
Your warehouse has pallet jacks, conveyors, forklifts, hand trucks, service carts, and other items considered as tools and equipment. Just like your warehouse building, these might get damaged or destroyed. Commercial property insurance will take care of such exposure with its business equipment and tools coverage. Business equipment and tools coverage will reimburse losses if fire, theft, vandalism, and other covered perils destroyed or damaged the equipment and tools of your warehouse.
If you own multiple warehouses and plan on moving goods between the warehouses, you’ll want to ensure that the goods are insured during their transit from one location to the next.
Often, the trucking and logistics companies that handle transportation will have their own form of inventory insurance, but it’s never a bad idea to have your own coverage as a backup in case the trucking company is unable to cover the costs of a claim completely.
So what insurance policy will cover instances where goods get damaged or lost while they’re being transported from your warehouse to another warehouse? Marine cargo insurance.
Marine cargo insurance has a warehouse to warehouse provision. A warehouse to warehouse provision protects the items from your warehouse against theft, vandalism, fire, and other covered perils, starting from departure, transit, and up until arrival at the receiving warehouse.
A business owner’s policy is an insurance product that combines general liability and commercial property insurance. Depending on which carrier it’s from, a business owner’s policy might also include business interruption insurance or workers' compensation insurance in its terms.
Your employees might suffer from a work-related injury or disease. Of course, you’ll have to pay for their treatment, rehabilitation, hospitalization, and lost income compensation. Do otherwise and employees might sue you.
Of course, you don’t want to spend business funds or personal funds when taking care of an injured or sick employee. In connection, workers' compensation insurance makes this possible.
Workers' compensation insurance is a state-mandated coverage. If an employee gets injured or sick because of work, workers' compensation insurance will pay the cost of treatment, hospitalization, rehabilitation, and lost income compensation.
The lost income compensation workers' compensation insurance provides is equal to two-thirds of the average weekly wage. This means that if an employee earns $1,455 per week, the lost income compensation to be received will be $974.85.
Workers' compensation insurance provides coverage if the employee dies from his/her injury or sickness. The policy will pay for funeral expenses and will give death benefits to the dependents.
Workers' compensation insurance is absolutely important. The Bureau of Labor Statistics states that the incidence rate of work-related injuries in warehouses is 4.8. This means that per 100 employees, nearly half will suffer from a job hazard. In connection, there are many reports that provide accurate insights on how warehouse employees might get injured or even die. Here are some examples:
| Incident Date | What Happened? |
|---|---|
| January 24, 2017 | Three employees were taking objects from warehouse shelving. Two of them were working from a cherry picker that was raised 20 feet. On the other hand, the third employee was left to operate the turret. For some reason, the turret hit the cherry picker. The operator was thrown from the vehicle. As for the cherry picker, it overturned with the two employees still tied off to the cage. All three employees got hurt and they were hospitalized and received treatment |
| June 29, 2017 | An employee was backing up with a loaded forklift. He then started to turn but changed his mind. This caused the forklift to overturn. As a result, The employee was stuck between warehouse racks. This resulted in a compound fracture to the left leg. The employee was taken to the hospital and treated for his injuries |
| June 30, 2017 | An employee was checking the quality of a door line. While doing this, she fell on the warehouse floor from a considerable height. The result of this was a twisted ankle and a fractured hip. She was taken to the hospital for a hip replacement surgery |
| October 25, 2017 | An employee was driving the forklift for a large company. As he was about to get off the forklift, a strap that was loosely hanging from his wand was caught by the wheels. The employee’s hand was pulled toward the forklift wheels. This resulted in severe amputation of the fingers |
| December 15, 2017 | An employee was securing a leaking super sack where a second super sack is stacked on top. While doing this, the stacked super sack fell on the employee. The employee sustained a compressed and fractured vertebra and spinal cord hematoma. The employee was hospitalized as he experienced lost sensation in the lower body and nerve damage |
Last but not least, you’ll need insurance for goods in warehouse. This type of coverage protects you and your business from any damage that happens to inventory that’s outside of your control. Damage could come from severe weather, vandalism, or theft. Often referred to as warehouse contents insurance, this type of coverage ensures that you and your business won’t be financially liable if products are lost or damaged.
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So, how much does warehouse insurance cost? Providing an exact number is difficult because one warehouse can differ significantly from the next. Some warehouses may just be small operations that store paper goods or small products such as soaps and candles, while others are big and store high-value electronics, heavy equipment, and auto parts.
However, to help you create a budget, we’ve researched and cross-referenced consumer and policyholder data to show you the average warehouse insurance cost that you can expect to pay.
While the average warehouse liability insurance cost is $93 per month or $1,106 per year for a $1m general liability insurance coverage, below, we’ve included the warehouse insurance rates of each type of warehouse insurance coverage individually.
| Coverage Type | Average Monthly | Average Yearly |
|---|---|---|
| Warehouse Property Insurance | $68 | $810 |
| Warehouse General Liability Insurance | $93 | $1,106 |
| Warehouse Inventory Insurance | $85 | $1,020 |
| Warehouseman’s Legal Liability | $31 | $369 |
| Warehouse-to-Warehouse Insurance | $79 | $948 |
| Warehouse Workers’ Compensation Insurance | $264 | $3,168 |
| Total for all the coverage types above | $620 | $7,421 |
Of course, keep in mind that these are just average warehouse insurance rates. The rates that you’ll actually pay may differ considerably, depending on the types of products that you’re storing, how many employees you have, the size of your warehouse business operation, the city your warehouse is located, and more. With that said, here’s another table showing the pricing of the general liability insurance from the best carriers.
| Cost per Month | Cost per Year | Best for | |
|---|---|---|---|
| CoverWallet | $71 | $852 | Warehouse insurance quotes comparison online |
| Geico | $79 | $948 | Mid-sized commercial warehouses that need a comprehensive workers’ comp policy |
| State Farm | $81 | $972 | Small to mid-sized warehouses that don’t anticipate making many claims |
| AXA | $94 | $1,128 | Large commercial warehouses and logistic trucking businesses |
Now that you’ve had a chance to take a look at all of your different options for warehouse insurance coverage let’s take a few minutes to review some of the best warehouse insurance companies on the market. We’ve included a brief overview of the companies' pros, cons, and pricing for a $1 million general liability insurance.
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Has a business owner’s policy with workers' compensation insurance
Doesn’t offer warehouse keepers insurance
CoverWallet’s warehouse insurance is available for general warehouses and storage. It offers four coverage options: general liability only with products and completed operations coverage, general liability with commercial property insurance, business owner’s policy with workers compensation insurance, and a custom plan.
There are many perks to choosing to get insured by CoverWallet. For one, you can purchase insurance in an instant and pay for premiums online. Also, there’s no stopping you from canceling a policy anytime. Finally, there’s the MyCoverWallet app where you can easily check the status of your insurance policies.
By the way, CoverWallet has an online quotes comparison platform you can use to find other companies that offer tailored warehouse insurance. Use that to find the best protection at the most reasonable price.
Best for: Warehouse insurance quotes comparison online
Average cost: $71 per month
Our rating: 10/10
Competitive rates for commercial warehouse insurance.
Handle your claims and billing through Geico’s easy-to-use online platform.
24/7 claims support.
Customer service ratings are just average
Doesn’t offer warehouse stock insurance
Government Employees Insurance Co., or Geico, is the nation’s second-largest insurance company and provides a wide range of both personal and commercial insurance policies that can be customized to fit any business, small or large. Geico also happens to have some of the more agreeable pricing and premium rates on the market. They can provide workers’ comp, liability coverage, and just about any other type of insurance your small business needs.
Best for: Mid-sized commercial warehouses that need a comprehensive workers’ comp policy
Average cost: $79 per month
Our rating: 9/10
As the nation’s largest insurer, they have agents available 24/7 for claims
Some of the best customer service ratings in the industry
Purchase an umbrella policy or build your policy as you need it
Handling claims can be a tedious process
State Farm is the largest insurance provider in the United States and has been around since the early-1920s, making it one of the oldest insurance companies in the country. Although most people think of State Farm as an auto insurer, they also provide large-scale comprehensive commercial business insurance policies for distribution and warehousing companies
Whether you just need a basic BOP (business owners policy) or comprehensive workers’ comp coverage, State Farm has you covered with competitive rates and great customer service.
Best for: Small to mid-sized warehouses that don’t anticipate making many claims
Average cost: $81 per month
Our rating: 8/10
AXA specializes in commercial insurance policies.
Comprehensive umbrella-style policies that cover all of your warehousing needs.
The insurer’s main office is located in Britain, which means claims handling may take a bit longer than average.
AXA is a British-based multinational insurance firm that specializes in providing comprehensive commercial insurance policies for mid to large-sized businesses. From comprehensive workers’ compensation plans to high-limit inventory insurance, warehouse-to-warehouse transportation coverage, and general/legal liability coverage, AXA provides it all.
Although their rates aren’t the cheapest on the market, their comprehensive policies are some of the most inclusive in the industry.
Best for: Large commercial warehouses and trucking businesses
Average cost: $94 per month
Our rating: 7/10
The best way to save money on your commercial warehouse insurance policy is to make a warehouse insurance quote comparison from different business insurance companies. By comparing warehouse insurance quotes, you’ll get the best deals, since insurers know they have to compete for your business and provide an attractive rate.
Simply click the ‘Get Quotes’ button below, enter some basic information on your warehouse business (or potential warehouse business), and you’ll receive customized quotes from some of America's top warehouse insurers. This will allow you to view your rates and coverage limits side-by-side to figure out which offer is best for you and your warehouse business!
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Use anyone except Employers. Period. They are non-transparent and shameful. After I complained long enough to warrant a call from a supervisor, the supervisor called back from a PRIVATE NUMBER (no caller ID), left a message that they are not reversing their decision (without any communication with me), and failed to leave a phone number for me to call back. She was hiding! They also fact find via email and phone calls, which is terrific for speed and communication. However, after setting a precedence of email or phone calls, they send time sensitive information via email, without any heads up... they are hoping you miss it and forfeit via expiration. Evil policies. Go elsewhere.
This place is an absolute joke of a company and should be ashamed of the way they conduct business. I was hurt on the job at the end of July and it took them just shy of 7 weeks to issue out a paycheck to me. Yes the amount was back dated but still. Not many have the luxury of not receiving a paycheck for almost 2 months. To top it all off, the original adjuster marked me down for the wrong state which caused a problem from the get go, I've had 3 different adjusters now since each one can't seem to figure out the simplicity of my claim. All my paperwork which includes, my job, house, and drs visits all are from the same state and city but yet some how I have been filed under a completely different state 1500 miles away. They do not answer your phone calls or emails no matter how many you leave. I've had to escalate my frustrations to the supervisors of each of these individuals in order to even get some kind of response. I've had more communication and information given to me about my claim from the customer service representatives then the actual adjusters.......... please tell me how that works?! A serious overhaul needs to happen here in order to serve your clients the way they deserve to be taken care of. 10/10 do not recommend this company to a single soul on earth
I have never had the displeasure of working with a more incompetent and disrespectful person in my life. I’m an injured worker and the adjuster that was assigned to my case was named Carrie Furgeson. In the past 6 weeks that I’ve been injured and out of work I have only been able to get ahold of her twice, not for lack of trying. I have left countless voicemails, countless emails, and she ignores them all. When I am finally able to get ahold of her I’m greeted with terrible customer service. She is rude, she talks over me and I’m hardly able to get a word in edgewise. She spelled my name wrong on my documents even after I spelled it for her properly countless times, this caused a whole new issue with my bank. I have bill collectors from the hospital calling me demanding payment and Carrie Furgeson won’t do a single thing to help, or to get them paid. All of my documentation is in Colorado, my job is in Colorado, my address is in Colorado, all my Dr offices and appointments have been in Colorado and Carrie still managed to hold my claim because she wasn’t sure what state she needed to file it under. It’s been 6 weeks since my Injury and my company still hasn’t received the wage paperwork to fill out so they can get me my correct wages. When she’s not ignoring me she’s answering my questions with “I don’t know” well I don’t know how she got this job, because apparently she doesn’t know anything about it. She is a disgusting morose individual inside and out and I genuinely wish her the worst in all of her future endeavors. I highly recommend you don’t use this company. Please if you are a business owner and your looking into this company please don’t use them. I’m sure they have the cheapest payment and that’s why companies use them in the first place, but you will be doing your employees a grave disservice by forcing them to venture into this absolute dumpster fire of a company. I would rate 0/5 if possible but 1 was the lowest I was allowed.
Their general liability insurance purchase process is simply the best online experience I've ever had in my life!
As long as they cover your line of business, you're literally covered! best rates, best coverage, best online experience, best professionals, can't be happier that I chose them!
Not all those who wander are lost.
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