Do you know that factories and warehouses are two of the instrumental components of manufacturing and storage businesses? They involve the physical structure of the building, installation of machinery, storage of raw materials, and many more things. Any damage to these assets could cease the operations of your business and lead to massive financial loss. Some unfortunate incidents that could be the reason for your business failure might be fire, riots, storms, floods, cyclones, earthquakes, terrorism, and theft. So, a crucial question arises here,
how to protect your business property from unexpected events and ensure it keeps functioning without any interruption? Well, putting your money on a comprehensive Factory and Warehouse Insurance policy could do the trick. Now, you might want to know what the current factory insurance cost for entrepreneurs is, right?
We will “definitely” come to that in the following section of this blog, but before that, you need to know:
What is Factory and Warehouse Insurance?
In the “easiest” terms, you can understand that Factory and Warehouse Insurance is a thorough coverage offered to businesses to compensate for monetary loss resulting from damage of goods, machines, or the building in which the plant was operating. Remember, the losses that occurred inside or outside your factory/warehouse premises also “get covered” under this insurance policy.
How much does Factory Insurance cost?
“Honestly speaking,” your factory insurance cost will depend on several variables. For example, to know what your potential premium would be, you need to factor in several risks, including:
1. Location of your plant or factory
2. History of past claim settlements
3. Nature of your business
4. Size of your company
In addition to these factors, the amount of your premium could also get affected by the add-ons you select. The more add-ons you take, the higher the “premium” of your insurance.
Why do you need to buy Factory Insurance?
Getting a factory insurance policy is “pretty essential” for every manufacturing plant owner since the insurance company repays them a specific amount in case of any damage to the business assets for various reasons. These reasons could be anything such as fire or natural disasters like storms, cyclones, or earthquakes. Since you can’t prevent other incidents like burglary or theft on your own, the insurance companies also provide coverage against such events under their factory insurance plans.
And do you know what the good news about factory insurance is? You can also extend this insurance policy to cover Business Interruption Insurance (also called Loss of Profit Insurance) to keep paying the rent, salary, and other expenses when you face “loss of income” during any disaster. Not just that, the BII insurance also comes in handy when you start rebuilding your business after a disaster.
Keep in mind that your employees are the most imperative asset of your business, and being unable to pay their salaries in unfortunate situations could lead to complete business failure. Thus, if you don’t want them to abandon your company for monetary reasons, you must consider buying Business Interruption Insurance with Factory Insurance that guarantees to pay their salaries through Loss of Profit coverage.
Now that you have acquired vital information about factory insurance cost and reasons to buy such insurance, it’s time to delve deep into:
What is add-on covers available under Factory and Warehouse Insurance policy?
There are a wide range of add-on covers available for the factory and warehouse insurance policy, such as:
1. Rent for alternative accommodation
2. Fire loss of profit
3. Terrorism
4. Plate glass cover
5. Public liability
6. Theft insurance
7. Fidelity cover
8. Machinery breakdown
9. Cash in safe and cash in transit
What events do not get covered under Factory and Warehouse Insurance policy?
Factory and warehouse insurance also comes with “some exclusions” like any other insurance you buy for your car or home. Below you can see several risk factors that don’t get covered under the factory and warehouse insurance:
1. Intentional damage to the property
2. Normal wear and tear due to deterioration
3. Damage to the property because of illegal activities and consequential loss.
4. Damages because of war or radioactive contamination and pollution
What are the benefits you get when you purchase a factory and warehouse insurance policy?
Just to let you know, the factory and warehouse insurance policy offers plenty of powerful benefits that are:
1. Coverage for a wide array of risks
2. Easy documentation
3. Customized cover
4. Comprehensive cover
5. Multiple location coverage
The concluding remarks
We hope you learned “a plethora of” things about factory and warehouse insurance in this blog, be it its definition, cost, add-ons, exclusions, or benefits. So, if you want to buy a factory and warehouse insurance policy now, feel free to get in touch with the leading insurance broker in India for a quick consultation.
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