Different types of Business Stock Insurance
- Flickr: Business Stock
Many businesses already have a form of insurance that may partial cover their stock, such as content insurance. However, these policies aren't designed to cover all types of stock; what if you have additional products elsewhere, or a form of stock that isn't considered "contents" of your business/warehouse premises? Business stock insurance is a specific form of insurance that does cover your stock, whether it be physical items in your office or products held elsewhere.
What is Business Stock Insurance?
Broadly speaking, business stock insurance covers a wide variety of stock that normal insurance won't cover. It tends to offer coverage over high value stock items, which probably won't be protected under a normal contents policy. Anything you sell as part of your business is considered stock, whether it's held in a warehouse, offshore or in your office.
Deterioration of Stock Insurance
One of the most comprehensive business stock insurance policies is deterioration of stock insurance, which is highly recommended for companies whose stock is likely to lose value of time for various reasons. The cover can also include:
- Reasonable costs incurred to avoid further deterioration of stock
- Obtaining condemnations certificates
- Loss or damage from storage conditions
Value of Business Stock Insurance
The cost you cover your stock for should be relative to the price of replacing the stock, not the selling price. Most insurance companies won't pay out if you claim for the selling value of stock, rather than the original replacement cost. However, you should ensure you don't undervalue your stock when seeking business stock insurance as this can have adverse effects on profits in the future should you need to replace anything.