Deterioration Of Stock Insurance

Stock insurance covers the costs of replacing your stock if any or all of it is lost, damaged, or stolen. Designed to protect you financially by securing your stock, it allows you to continue to trade if your unsold goods are destroyed. Some insurance suppliers offer stock insurance as a standalone policy, but most are available as an extension to an existing business contents policy.

Many businesses have to control stock in specially temperature-controlled environments such as a freezer to keep it in usable condition. It might be frozen goods, pharmaceuticals, flowers or anything else which has a finite shelf life. Even a small change in conditions could cause stock to spoil and cost you thousands. This is what deterioration of stock insurance covers you against. 

There are many ways to reduce the risk of damaged stock, such as weatherproofing your stockroom, keeping the stockroom clean and tidy, hanging clear visible signs, making sure that the stockroom is well-lit, investing in appropriate safety equipment, hosting training sessions for your staff, and knowing what stock you have on hand.

This product is ideally there for people who keep large quantities of perishable goods on site such as a restaurant. If you only keep a few hundred pounds of products in freezers, your existing contents insurance policy may cover it. Equally, in that case, it may not be worth the expense of insuring something you could cover yourself. This is really there for those companies whose losses would run into the thousands.

If a fault with a freezer causes you stock to spoil, it’s not just the cost of replacing it you must think about but also the cost of repairing faulty equipment, transferring stock or arranging disposal. However, these costs will not be covered by deterioration of stock, so it might make sense to consider other options such as whether it’s included in equipment insurance policies.

Reasons stock may deteriorate include the failure of utilities, refrigerant contamination and accidental damage to machinery. Because of how many ways your stock can be ruined, it’s essential that you have cover protecting your business against the consequences of this.

The only mandatory insurance for businesses in the UK is employers’ liability insurance, but it is definitely worth considering product liability insurance too if you sell products. If one of your products injures someone or damages their property, you could be held liable, even if you didn’t manufacture or make the product yourself.

Yes, you should consider public liability insurance if you sells products and receive customers in the physical premise of your business. Although it is not a legal requirement in the UK, public liability insurance covers you for the cost of any claims that are made against you, so it is important for any business.

On average, annual public liability insurance in the UK costs around £120, but sole traders and small businesses can expect to pay less than that, with many insurance premiums costing around the region of just £40 a year. There are many factors affecting the cost of insurance though, such as the amount of cover and your claims history.