In a warehouse the value lies not in the building but in what is stored there and how it is stacked; that method of storage is the first and heaviest question every insurer asks.
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In brief
A warehouse is a large, high space with a lot of combustible material on vertical racking. Fire travels upwards there and along the aisles, and that is precisely why an insurer looks at racking height, compartmentation, fire-fighting provisions and the distance to the outer wall. Two buildings of the same size can be assessed very differently on the basis of how they are laid out.
The second question is who owns the goods. What you store for customers or suppliers is not your own stock but property in your care, custody and control, and those are excluded as standard on ordinary liability insurance. Without a separate care, custody and control section or goods insurance in the owner's name, you are left with the bill after a fire or water damage.
If the doors stay shut after an incident, your turnover stops while rent, salaries and lease instalments continue. You absorb that with business interruption, or with cover for additional costs if you can continue the work elsewhere for a while.
The structure of the cover in three parts, with an overview per situation below.
The basics
Liability
AVB for property damage and injury, BAV for professional errors.
Damage to third parties
Employers' liability
Care, custody and control as an extension
Your business
Assets and continuity
Business contents, goods and lost turnover during downtime.
Business contents at replacement value as new
Goods at cost price
Business interruption or additional costs
If you employ people
Staff
Sickness absence, accidents and the traffic risk.
Continued pay for 104 weeks
Group personal accident
WEGAS for traffic risks
What is covered
Situation
AVB
BAV
Cyber
Injury to a visitor or customer
Yes
No
No
Damage to a client's property
Sometimes
No
No
Financial loss caused by an advisory or calculation error
No
Yes
No
Downtime after a ransomware attack
No
No
Yes
Data breach involving personal data
No
Sometimes
Yes
Damage to property in your care
No
No
No
This overview is general in nature and is not personal advice. What is actually covered, including exclusions, limits and the excess, is set out in the policy conditions and the insurance card (verzekeringskaart) of the insurer; you receive both before you take out cover. Taking out cover without advice? Then read what execution only means for you.
Where things go wrong in practice
Four points that make the difference between a policy that pays out and one that does not.
Stock values move; the sum insured usually does not
Most warehouses have peaks: before the holidays, at the start of a season or just after a large purchase there is a multiple of the annual average on site. If the sum insured is based on that average, you are underinsured at precisely the busiest moment and payment is made in proportion. Ask for a stock clause that absorbs the peak period, and notify one-off large consignments separately.
What you store determines acceptance, and that changes
If you take on a new product segment, start storing batteries, aerosols or plastics, or stack one level higher than declared, the risk changes materially. A departure from the notified method of storage can lead to a reduced or refused payment after a fire. Review your declaration each year, and report a change before the first pallet arrives rather than at the next renewal.
Internal transport causes the day-to-day damage
The large losses come from fire, the many small ones from the forklift truck: a racking upright hit, a sprinkler pipe drilled through, a pallet knocked over. A damaged upright makes the whole rack unstable, and that is a collapse risk. Have racking inspected periodically, keep the inspection reports and make sure damage to racking is reported rather than quietly straightened out with a nudge from the forklift.
What warehouse insurance does not pay for
Not covered are obsolescence, falls in value and deterioration without an identifiable event, as well as inherent defects in the goods stored. A difference between the books and the physical stock counts as a stock discrepancy and not as theft; for theft you need signs of forced entry or a demonstrable event. Damage to third-party property remains outside the liability cover for as long as no care, custody and control section is included.
What does your premium depend on?
Sum insured for stock — The average and maximum value of the goods present form the basis for the goods premium.
Nature of the goods stored — Combustibility, susceptibility to water damage and how easily goods can be resold after theft all three count.
Storage height and racking layout — Stacking higher and narrower aisles increase fire spread and make fire-fighting harder.
Fire prevention and compartmentation — Sprinklers, a fire alarm system, fire separations and the distance to neighbouring premises determine the maximum size of a loss.
Security level — The security rating of walls and doors, alarm response and camera surveillance count more heavily the more easily the stock can be resold.
Third-party property in your care — If you store goods for customers, a separate section with its own sum insured is added.
Insurers weigh these details differently. That is why comparing pays off.
How we arrange it
You request a quoteWe take stock of your situation, your risk and your wishes.
We compareseveral insurers, on premium as well as conditions.
You receive a proposalWith an explanation of the differences and the exclusions.
We arrange the switchIncluding cancellation, so there is no gap in cover.
Customers rate our service on four aspects: personal service, service delivery, availability and the outcome. The reviews are collected and published by NH1816 and come from customers who have actually taken out a policy with Finass Advies B.V. or reported a claim.
Not automatically. Property you have in your care for someone else is care, custody and control, and that is excluded as standard on public and employers' liability insurance (AVB). You arrange it with a separate care, custody and control section or by having the owner insure the goods themselves with a waiver of recovery. Set out in your storage conditions which route applies and up to what amount you accept liability, because that is what is examined when a loss occurs.
What does underinsurance mean where stock fluctuates?
If there is more on site at the time of the loss than the sum insured, the insurer pays in proportion. With a partial loss you notice it immediately: only part of a fire in a single rack is paid. A stock clause or a policy with higher peak cover in certain months prevents that. Work with a realistic count and not with an accounting annual average.
I rent the warehouse. What do I insure and what not?
The building is for the owner; you insure the business contents, the stock and the tenant's improvements, that is to say the improvements you have made yourself such as racking, floor coating, refrigeration and partition walls. Those often fall between two stools because the owner does not include them in the buildings value. Put them on the policy expressly and check what the lease says about this.
How long should my business interruption cover run?
Choose the indemnity period on the basis of the time you actually need to be trading at full capacity again: finding new premises, obtaining permits, having racking installed and buying in stock again. With long delivery times or a specific fit-out that runs on longer than a standard period. Work that period out in advance with your suppliers, not after the loss has happened.
Finass Verzekert is a trading name of Finass Advies B.V. We advise on and arrange non-life insurance on the basis of an objective analysis of several insurers, and receive commission for this from the insurer, which is included in the premium. You pay no separate advice fee. Before you take out cover, we establish your wishes and needs.
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