Smart insurance placements are about flexibility, allowing clients and producers to structure coverage effectively and achieve better results.
Traditionally, inventory was often wrapped within Property or Stock Throughput (STP) programmes. However, the London Cargo Market is undergoing a notable shift, reflecting a growing awareness that stand-alone Stock insurance can offer distinct advantages for Insureds.
By separating inventory coverage, businesses often gain more competitive pricing, lower deductibles and broader wordings tailored more precisely to the nuances of their operations.
Why Stock Deserves Its Own Policy
As businesses face increasing supply chain volatility, warehousing risks, and changing storage environments, underwriters are rethinking how best to price, underwrite and insure Stock on a stand-alone basis.
But why is this shift happening now? Stock-only solutions are gaining traction because they allow:
Real cost savings
Premiums are often more competitive when risks are clearly understood. Separating Stock from a combined placement enables insurers to evaluate exposures more accurately, allowing clients to secure pricing that reflects true risk, often opening the door to side-by-side quote comparisons between Property and Stock insurers.
Lower AOP and catastrophe deductibles
While Property policies often carry high AOP retention (sometimes up to USD 500,000 or a percentage of the Total Insured Value for catastrophe perils), Stock policies can offer flat deductibles from as low as USD 10,000-25,000 for AOP, with CAT deductibles ranging from USD 25,000-100,000. With separate inventory coverage, insureds can negotiate lower retentions, reducing their out-of-pocket expenses in the event of a claim.
Bespoke wording and customised cover
Stand alone Stock insurance delivers precision. Stock policies can be tailored to include clauses for temperature-sensitive goods, spontaneous combustion risks or specific storage environments. Clearer terms mean less ambiguity, fewer disputes and coverage that performs when it matters.
Broader location coverage
Stock-only policies extend beyond owned premises. They also provide full value cover for inventory held at third-party locations, ideal for clients with distributed supply chains or dynamic storage needs.
Why One Policy Doesn’t Fit All
Separating Stock from Property placement can unlock greater catastrophe capacity, especially in high-CAT zones. By having separate policies for Property and Stock, businesses can access individual catastrophe limits for events like earthquakes, floods and windstorms - each treated separately in the London Stock market.
Separating policies can also reduce premium costs. A Property loss might involve substantial building damage and business interruption, but only a small proportion Stock. With Stock insured separately, it is easier to isolate the value and request that insurers price based on the risk they are insuring.
Ready to Reframe the Risk?
Stock-only insurance is specialist by nature. To quote and deliver pricing that is both competitive and tailored, we need the right information. Below are some of our best broking tips for securing competitive Stock quotes from London insurers.
Accurate Risk Assessment
We require both the estimated maximum and average inventory values. London insurers will rate on average, if available.
Full COPE Data
Clients with well-established warehousing risk management are well-positioned to take advantage of underwriting appetite in this area. Make sure you support your submission with full COPE data, including age, construction, fire protection and security.
Tailored Coverage
We need to understand the operations of each location - is it distribution only, retail, manufacturing, etc? Understanding the risk will help with London pricing.
Accurate Valuation
To ensure the policy properly indemnifies the insured’s exposures, it is crucial to agree on accurate valuation preferences, including replacement cost and selling price. These valuations are essential for rating the risks and paying claims fairly and accurately.
Remember, the more precise our information, the better we can align pricing, wording and coverage.
The way coverage is placed is important. Stock-only policies mean brokers can offer something new: choice. This is not about criticising traditional coverage but exploring alternative possibilities. The opportunity is there, and it begins by asking: Is it time to view Stock differently?
Stock-only solutions are not simply a new trend. When done right, they can bring real value to clients and producers looking for cost savings, clarity and a better fit for how their business works today.
Speak to our Cargo Risk Solutions team today to explore your options. The team has an exclusive product offering, SmartBIND, which has a Stock-only capacity limit of USD 50,000,000.
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