Logistics Hub Insurance: Warehouse & Transport Coverage

Introduction

If you run a logistics hub—warehouse, distribution centre, cross-dock facility or 3PL operation—you’re managing risk on multiple fronts at once. Stock moves in and out at speed. Forklifts and HGVs operate side-by-side with pedestrians. Customers expect next-day delivery, and a single incident (a fire, a flood, a cyber attack, a vehicle rollover) can halt operations and trigger contractual penalties.

That’s where logistics hub insurance comes in. In practice, it’s usually a tailored package combining property, stock, liability and transport-related covers—often built around a Commercial Combined policy, with add-ons for goods in transit, fleet, cyber and specialist extensions.

This guide explains what logistics hub insurance typically includes, the risks it’s designed to address, and how to structure cover for both warehouse and transport exposures.

What is logistics hub insurance?

Logistics hub insurance isn’t one single standard policy. It’s a practical term for an insurance programme designed for businesses that:

• Store goods (owned stock or customers’ stock)

• Handle and move goods (loading, unloading, picking, packing)

• Transport goods (own vehicles, subcontracted carriers, courier networks)

• Provide value-added services (labelling, kitting, light assembly, returns management)

Because logistics operations blend property risk, liability risk and transport risk, insurers usually build cover using a combination of:

• Commercial Combined insurance (buildings, contents, stock, business interruption, liability)

• Goods in Transit insurance (your liability for goods while being transported)

• Commercial Motor / Fleet insurance (vehicles and drivers)

• Employers’ Liability (legal requirement if you employ staff)

• Cyber insurance (for WMS/TMS, customer data, ransomware)

• Optional specialist covers (engineering inspection, deterioration of stock, legal expenses)

Key risks for warehouses and logistics hubs

A good policy starts with a clear view of the real-world risks. Common exposures include:

• Fire (electrical faults, charging stations, packaging materials, arson)

• Flood and escape of water (sprinkler discharge, burst pipes)

• Theft and malicious damage (high-value goods, organised crime)

• Impact damage (forklifts, racking collapse, vehicle strikes)

• Stock spoilage or deterioration (temperature-controlled goods)

• Public and products liability claims (visitors, contractors, third-party property)

• Employers’ liability claims (manual handling injuries, slips/trips)

• Goods in transit losses (collision, theft from vehicle, load shift)

• Contractual and service level penalties (late delivery, failed KPIs)

• Cyber incidents (ransomware, system outage, data breach)

The right cover is the one that matches your operation: what you store, how you store it, how you move it, and what your contracts say you’re responsible for.

Warehouse insurance: what should it cover?

1) Buildings and property damage

If you own the premises, you’ll usually need Buildings insurance for:

• The structure (walls, roof, floors)

• Fixed plant and machinery

• Loading bays, dock levellers, yard lighting, perimeter fencing

• Office fit-out (if part of the building)

If you lease the premises, you may still be responsible for tenant’s improvements and sometimes for the building under a full repairing lease. Always check your lease obligations.

Common causes of claims: fire, storm damage, flood, escape of water, impact, vandalism.

2) Contents, equipment and racking

Warehouses are equipment-heavy. A strong policy should consider:

• Racking, shelving and mezzanines

• Forklifts and MHE (material handling equipment)

• Conveyors, sortation systems, pallet wrappers

• Scanners, printers, IT hardware

• Tools and maintenance equipment

Tip: racking is often overlooked or underinsured. Replacement costs can be significant, especially for specialist systems.

3) Stock and customers’ goods

This is where logistics hub insurance gets nuanced.

• If you own the stock, you need Stock insurance.

• If you store customers’ goods, you may need Bailees’ liability or Goods in Trust cover.

Your contracts often define whether you’re liable for loss/damage to customers’ goods, and whether liability is limited (e.g., per pallet, per tonne, per consignment). Your insurance should mirror those terms.

Watch-outs:

• High-value goods (electronics, alcohol, pharmaceuticals)

• Theft-attractive items (mobile phones, designer goods)

• Seasonal peaks (sum insured must reflect maximum values)

• Unattended vehicle loading areas and yard storage

4) Business interruption (BI)

Business interruption cover can be the difference between a disruption and a disaster. It can help replace lost gross profit and cover ongoing costs if operations are interrupted by an insured event (like a fire).

For logistics hubs, BI should be structured around:

• Indemnity period (often 12–24 months; sometimes longer for major rebuilds)

• Increased cost of working (temporary premises, overtime, outsourcing)

• Loss of rent (if you sublet part of the building)

Consider contingent BI: if you rely on a single key site, supplier or customer, a disruption elsewhere can still hit your income.

5) Deterioration of stock / temperature control

If you store chilled or frozen goods, consider:

• Deterioration of stock (spoilage due to breakdown or power failure)

• Engineering breakdown for refrigeration plant

• Utilities failure extensions

Insurers will look closely at maintenance records, alarm monitoring, and temperature logging.

Transport coverage: protecting goods and vehicles

1) Goods in Transit (GIT)

Goods in Transit insurance covers loss or damage to goods while being transported—typically by your own vehicles, and sometimes by subcontractors (depending on wording).

Key points to define:

• What goods are covered (including exclusions like tobacco, alcohol, phones)

• Territorial limits (UK only vs UK & EU)

• Limits per vehicle / per load

• Theft conditions (overnight parking rules, security requirements)

• Loading/unloading (is it included?)

If you’re a carrier, you may also need cover aligned to your legal liability under carriage conventions and contract terms.

2) Commercial motor / fleet insurance

If you operate vans, HGVs, forklifts on public roads, or a mixed fleet, you’ll need Commercial Motor or Fleet cover.

Typical options include:

• Third Party Only

• Third Party, Fire & Theft

• Comprehensive

Add-ons to consider:

• Hire vehicle / courtesy vehicle

• Windscreen cover

• Breakdown

• Trailer cover

• Goods-carrying liability (often separate from motor)

Insurers will assess driver age/experience, claims history, telematics, vehicle security, and routes.

3) Employers’ and public liability

Logistics sites have constant footfall: drivers, contractors, visitors, customers.

• Employers’ Liability (EL) is a legal requirement in the UK if you employ staff.

• Public Liability (PL) covers claims from third parties for injury or property damage.

Common PL scenarios:

• A visiting driver slips on a wet loading bay

• A contractor’s vehicle is damaged by your forklift

• A pallet falls and damages a customer’s property

4) Products liability (when applicable)

If you repackage, label, assemble, or alter products, you may create a products liability exposure. Even simple kitting or relabelling can be relevant.

Cyber and systems risk (often underestimated)

Modern logistics runs on systems: WMS, TMS, handheld scanners, EDI integrations, customer portals.

Cyber insurance can help with:

• Ransomware response and recovery

• Business interruption from system outage

• Data breach costs and liability

• Incident response support (forensics, legal, PR)

Even if you don’t store sensitive medical data, you may still hold customer information, delivery addresses, and commercial contracts.

Common exclusions and gaps to watch

Insurance is as much about what’s not covered as what is. Common pitfalls include:

• Underinsurance (stock values fluctuate; racking and fit-out overlooked)

• Unattended vehicle theft conditions not met

• Incorrect description of goods (hazardous materials, lithium batteries)

• Wear and tear / gradual deterioration (maintenance-related losses)

• Contractual liability beyond what’s covered

• Subcontractor exposure (who is responsible when a third-party carrier is used?)

• Non-disclosure of security measures (alarms, CCTV, access control)

A proper review of your contracts and operational realities is essential.

How insurers price logistics hub insurance

Premiums are typically influenced by:

• Construction type and fire protections (sprinklers, alarms)

• Location (flood risk, crime rates, proximity to emergency services)

• Security (CCTV, access control, perimeter fencing, keyholding)

• Nature of goods stored (high value, theft-attractive, hazardous)

• Maximum stock values and seasonal peaks

• Claims history

• Fleet profile (vehicle types, driver records, routes)

• Risk management (training, H&S processes, racking inspections)

The clearer your risk presentation, the easier it is to negotiate sensible terms.

Risk management checklist (what underwriters want to see)

To improve terms and reduce claims, focus on:

• Fire risk assessment and housekeeping

• Battery charging area controls (especially lithium-ion)

• Sprinkler maintenance and testing

• Racking inspections (SARI or equivalent) and load signage

• Segregation of pedestrians and vehicles

• Yard security and key control

• CCTV coverage and retention periods

• Driver training, licence checks, and telematics

• Temperature monitoring and alarm response procedures

• Cyber controls: MFA, backups, patching, phishing training

Choosing the right cover: a practical approach

When arranging logistics hub insurance, start with three questions:

1. What’s the worst-case loss at the site? (building + equipment + stock + downtime)

2. What are you contractually responsible for? (especially for customers’ goods)

3. Where does your risk sit—warehouse, transport, or both?

From there, build a programme that:

• Matches your stock values at peak

• Covers customers’ goods where you’re liable

• Includes BI with a realistic indemnity period

• Aligns Goods in Transit limits to your maximum load

• Addresses cyber and systems dependency

FAQs: Logistics hub insurance

Do I need insurance if I only store customers’ goods?

Often, yes. If you have responsibility for customers’ goods under contract (or in practice), you may need bailees’ liability or goods in trust cover.

Is Goods in Transit the same as motor insurance?

No. Motor insurance covers the vehicle and third-party road risks. Goods in Transit covers the goods being carried (subject to policy terms).

What if I use subcontracted hauliers?

You may still have liability to your customer even if a subcontractor is at fault. Your policy wording should clarify whether subcontracted carriage is included, and you should check subcontractor insurance and contracts.

How do I set the right stock sum insured?

Use your maximum foreseeable stock value, not the average. Consider seasonal peaks, customer surges, and high-value consignments.

Does insurance cover warehouse delays and penalties?

Standard policies generally cover insured perils (like fire) and resulting business interruption, but contractual penalties and pure delay costs may not be covered unless specifically insured.

Are forklifts covered under motor insurance?

Forklifts used solely on private premises may be covered under property/plant sections. If used on public roads, they may need motor cover. Always confirm your usage.

Next steps

Logistics hubs are complex operations, and the right insurance is rarely “off the shelf”. A tailored programme can help protect your premises, your people, your customers’ goods and your ability to keep deliveries moving.

If you’d like, share a few details (type of goods, maximum stock value, number of vehicles, and whether you store customers’ goods under contract) and I can outline a recommended cover structure and the key questions to ask your broker/insurer.