Manufacturing Insurance in Scotland (Glasgow & Edinburgh): A Practical Guide for Manufacturers

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Manufacturing Insurance in Scotland (Glasgow & Edinburgh): A Practical Guide for Manufacturers

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Manufacturing Insurance in Scotland (Glasgow & Edinburgh): A Practical Guide for Manufacturers

Introduction: why manufacturing insurance matters in Glasgow and Edinburgh

Scotland has a strong manufacturing base, and Glasgow and Edinburgh sit at the centre of it—supported by ports, logistics links, universities, and a growing ecosystem of engineering, electronics, food and drink, medical technology, and specialist fabrication.

But manufacturing also concentrates risk. A single fire, machinery breakdown, product recall, cyber incident, or supplier failure can stop production and hit cashflow fast. The right manufacturing insurance isn’t just a “policy”—it’s a resilience plan that helps you keep trading when something goes wrong.

This guide explains the core covers most Scottish manufacturers need, the risks insurers focus on, and how to structure a policy that fits your operation—whether you’re in an industrial estate outside Glasgow, a city-fringe unit, or a specialist workshop serving customers across the UK.

What is manufacturing insurance?

Manufacturing insurance is typically arranged as a tailored package (often a Commercial Combined policy) designed to protect:

  • Your premises, plant and stock

  • Your liability to employees and the public

  • Your products and contractual responsibilities

  • Your income if production is interrupted

  • Your equipment and machinery

  • Your data, systems and cyber exposures

In practice, it’s a combination of covers, limits, and extensions that reflect what you make, how you make it, and where your risks sit.

Why Glasgow and Edinburgh manufacturers can face unique risk factors

Every manufacturer is different, but insurers often pay attention to local and operational factors that can be common in Glasgow and Edinburgh:

  • Mixed-use and city-fringe locations: neighbouring occupancies can increase fire and security exposure.

  • Older industrial buildings: construction type, electrics, and fire compartmentation can affect underwriting.

  • Supply chain and logistics: reliance on road networks, ports, and time-critical deliveries.

  • Skilled labour and specialist machinery: higher values and longer lead times for repairs or replacements.

  • Export and UK-wide distribution: increased product liability and transit exposure.

  • Regulatory expectations: health and safety management, risk assessments, and documented controls.

A good policy doesn’t just “tick boxes”—it reflects these realities.

Core covers most Scottish manufacturers should consider

1) Buildings insurance (if you own the premises)

If you own your factory, workshop, or unit, buildings cover protects the structure against insured events such as fire, flood, storm, escape of water, impact, theft and malicious damage.

Key points to get right:

  • Rebuild cost (not market value)

  • Construction type (e.g., steel portal frame, flat roof percentage)

  • Sprinklers and alarms (and whether they are maintained)

  • Flood exposure (especially where surface water risk is relevant)

If you lease your premises, you may still need cover for tenant’s improvements, fixtures, and any contractual responsibilities in your lease.

2) Contents, stock and materials

Manufacturers often hold a mix of:

  • Raw materials

  • Work in progress

  • Finished goods

  • Packaging

  • Tools and equipment

Your policy should reflect peak seasonal stock and how goods are stored (racking, mezzanines, external storage, temperature control). Under-insuring stock is a common issue—especially if your inventory value spikes at certain times.

3) Business interruption (BI)

Business interruption cover protects your gross profit (or gross revenue, depending on the basis) if you can’t trade normally due to an insured event.

For manufacturers, BI is often the difference between a disruption and a crisis.

Important decisions:

  • Indemnity period: 12 months may be too short if machinery lead times are long. Many manufacturers choose 18–24 months.

  • Sum insured: should reflect realistic turnover and gross profit.

  • Extensions: such as denial of access, public utilities, and supplier/customer dependency.

Example: if a fire damages a key production line, BI can help cover ongoing overheads and lost gross profit while you repair, outsource, or rebuild.

4) Employers’ liability (EL)

If you employ staff, EL is a legal requirement in the UK in most cases. It protects you if an employee is injured or becomes ill due to their work.

Manufacturing-specific exposures include:

  • Manual handling injuries

  • Machinery and guarding incidents

  • Noise-induced hearing loss

  • Respiratory exposures (dusts, fumes, chemicals)

  • Slips, trips and falls

Insurers will often look for evidence of:

  • Risk assessments

  • Training records

  • PPE policies

  • Maintenance logs

  • Accident reporting procedures

5) Public and products liability

Public liability covers injury or property damage to third parties arising from your business activities.

Products liability covers claims arising from products you manufacture, supply, or import.

For Glasgow and Edinburgh manufacturers selling across the UK (or exporting), products liability is often a critical cover.

Underwriters may ask:

  • What you manufacture and who uses it

  • Whether products are safety-critical

  • Your quality control process

  • Contract terms and warranties

  • Any use of subcontractors or outsourced manufacturing

If you manufacture components used in larger systems, consider whether you need higher limits due to “downstream” losses.

6) Product recall and contamination (where relevant)

If you manufacture food, drink, cosmetics, or any product where contamination is a risk, product recall cover can help with:

  • Recall costs

  • Disposal

  • Customer notification

  • PR and crisis management

Even non-food manufacturers may need recall cover if a defect could trigger a large-scale withdrawal.

7) Machinery breakdown / engineering inspection

Manufacturers depend on machinery. Machinery breakdown cover can help with sudden and unforeseen breakdown of insured plant, and can be paired with:

  • Engineering inspection (where required)

  • Deterioration of stock (if you rely on refrigeration)

  • Additional increased cost of working (e.g., hiring temporary equipment)

If a single machine is a bottleneck, it’s worth structuring cover around it.

8) Goods in transit and own vehicles

If you move goods between sites, deliver to customers, or use couriers, consider:

  • Goods in transit cover (own vehicles and/or carriers)

  • Commercial vehicle insurance (if you operate vans, HGVs, or fleet)

  • Tool and equipment cover for mobile teams

Manufacturers often discover gaps when they assume couriers are fully responsible. In reality, liability limits and exclusions can apply.

9) Cyber insurance

Manufacturers are increasingly targeted by cyber crime and operational disruption, including ransomware.

Cyber insurance can help with:

  • Incident response and forensics

  • Business interruption from cyber events

  • Data breach costs and regulatory support

  • Cyber extortion

  • System restoration

Even if you don’t store “lots of personal data”, your operational reliance on systems can create significant exposure.

10) Commercial legal expenses

Legal expenses cover can help with:

  • Employment disputes

  • Contract disputes

  • Tax investigations

  • Debt recovery

For manufacturers dealing with suppliers, customers, and contracts, it can be a practical add-on.

Key risks insurers focus on (and how to present your business well)

When insurers price manufacturing risks, they’re not just looking at your postcode. They’re looking at how you manage risk day-to-day.

Fire and hot works

Fire is one of the biggest loss drivers in manufacturing.

Insurers may ask about:

  • Hot works procedures and permits

  • Waste management and housekeeping

  • Storage of flammables

  • Electrical testing and maintenance

  • Fire detection, alarms, and extinguishers

Practical improvements that can help:

  • Documented hot works permit system

  • Clear separation of ignition sources and combustibles

  • Routine electrical inspections

  • Fire doors and compartmentation maintained

Security and theft

Security is about more than locks.

Insurers may consider:

  • Alarm type and monitoring

  • CCTV and lighting

  • Perimeter security

  • Keyholder procedures

  • High-value stock storage

Quality control and traceability

For products liability, insurers want confidence in your controls.

Helpful evidence includes:

  • Batch records and traceability

  • Incoming goods inspection

  • Testing and calibration logs

  • Supplier vetting

  • Documented change control

Maintenance and resilience

If your plant fails, how quickly can you recover?

Insurers like to see:

  • Planned preventative maintenance

  • Critical spares strategy

  • Service contracts

  • Backup suppliers

  • Contingency plans for key machinery

Glasgow vs Edinburgh: does location change the insurance?

Your city doesn’t automatically decide your premium, but it can influence underwriting through practical factors:

  • Premises type: industrial estates, mixed-use areas, and older buildings can affect fire and escape of water risk.

  • Access and logistics: delivery routes, loading bays, and congestion can influence claims frequency.

  • Flood and weather: localised surface water risk can be relevant.

  • Neighbouring trades: proximity to higher-risk occupancies can impact insurer appetite.

The biggest pricing drivers are still your trade, processes, turnover, claims history, and risk management.

How to choose the right limits and structure

A common mistake is buying “standard” limits that don’t match manufacturing reality.

Consider:

  • Buildings/contents: insured at realistic rebuild and replacement values.

  • Stock: include peak values and WIP.

  • BI indemnity period: long enough for rebuild and retooling.

  • Liability limits: aligned to contracts and customer requirements.

  • Excesses: set at a level you can absorb without harming cashflow.

If you supply larger organisations, check contract terms for required limits (and any special clauses).

Common gaps to avoid

Manufacturers often run into problems because of gaps like:

  • Under-insured stock and WIP

  • BI period too short

  • No cover for machinery breakdown

  • No goods in transit cover

  • Exclusions for certain processes (e.g., heat work, flammables) not understood

  • Incorrect business description (leading to disputes at claim time)

A broker who understands manufacturing can help you avoid these issues.

What insurers typically ask for when quoting

To get accurate terms, be ready with:

  • Business description and processes

  • Turnover split (UK/export) and key customers

  • Premises details (construction, security, fire protection)

  • Values (buildings, contents, stock, machinery)

  • Claims history (usually 3–5 years)

  • Risk management documents (where available)

  • Any certifications (e.g., ISO standards)

The more clearly you present your operation, the easier it is to place cover on competitive terms.

Claims: what good cover should deliver

When something goes wrong, you want:

  • Clear policy wording and realistic extensions

  • Responsive claims handling

  • Access to specialist loss adjusters where needed

  • Support to keep trading (temporary premises, hire equipment, outsourcing)

Manufacturing claims often involve multiple moving parts—property damage, BI, engineering, and liability—so having the right structure upfront matters.

Quick checklist: manufacturing insurance essentials

Use this as a starting point:

  • Buildings (if applicable)

  • Contents, stock, and WIP

  • Business interruption (gross profit) with a suitable indemnity period

  • Employers’ liability

  • Public and products liability

  • Machinery breakdown / engineering

  • Goods in transit

  • Cyber

  • Legal expenses

  • Optional: product recall, environmental liability, management liability

FAQs: manufacturing insurance in Scotland

Do I need employers’ liability if I only have part-time staff?

In most cases, yes. If you employ anyone, even part-time, EL is usually required by law (with limited exceptions).

Is product liability included automatically?

Not always. Some policies include it as standard, others require it to be selected with an appropriate limit. Always confirm.

How much business interruption cover should I buy?

It depends on your gross profit and how long recovery would realistically take after a major loss. Manufacturers often need longer indemnity periods due to machinery lead times.

Will insurers cover subcontracted manufacturing?

Often yes, but you must disclose it. Your liability and quality control responsibilities may still apply.

Does cyber insurance matter if we don’t sell online?

Yes. Many cyber losses come from ransomware and operational disruption rather than online sales.

Next steps: get a tailored manufacturing insurance quote

If you manufacture in Glasgow, Edinburgh, or anywhere in Scotland, the best approach is a policy built around your actual processes, values, and contractual obligations.

A quick conversation can identify where you’re over-insured, under-insured, or missing critical extensions.

Get a quote online via the Insure24 portal or call 0330 127 2333 to discuss manufacturing insurance tailored to your Scottish operation.

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