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PCB INSURANCE, SIMPLIFIED (WITHOUT THE JARGON)
PCB Insurance Cover Explained (Fabrication & PCBA/SMT)
PCB manufacturing insurance can feel confusing because policies use broad labels — “property”, “liability”, “BI” — while PCB losses are specialist: high-value compact stock, multi-stage work-in-progress, bottleneck machines, customer-supplied components, and contracts that push responsibility down the supply chain.
This guide explains what the main insurance covers are designed to do, where the common exclusions and gaps appear, and how to build a coherent programme. Final cover always depends on the insurer’s wording, underwriting appetite, and the facts of your risk.
If you want a fast, underwriting-ready quote, call Insure24 on 0330 127 2333 or use the “Get a Quote” button — we’ll map your exposures and present the risk properly to the right markets.
How PCB Insurance Programmes Are Typically Structured
Many PCB businesses arrange a combined “package” policy (or a coordinated set of policies) built around four core pillars: property/stock, business interruption, employers’ liability and public/products liability.
Then, depending on your operation, the programme is expanded with specialist add-ons such as customers’ goods, equipment breakdown, goods in transit, professional indemnity and cyber.
The goal is alignment: limits, territories, conditions, and values that match your real exposures — so you don’t find out at claim time that the programme was built for generic manufacturing rather than electronics.
The “Core Four” Covers
- Property / Buildings / Contents – protects physical assets against insured events (subject to wording)
- Stock & Work in Progress – raw materials, components, panels, assemblies (values must reflect peaks)
- Business Interruption – protects gross profit/loss of income after insured disruption
- Employers’ Liability – legal liability for employee injury/illness (UK statutory requirement in most cases)
- Public & Products Liability – third-party injury/property damage from operations/products
Specialist Add-ons (Common in PCB)
- Customers’ Goods – consignment stock / customer-owned components and tooling
- Equipment Breakdown – sudden breakdown of insured plant; can be aligned with BI
- Goods in Transit – protect high-value shipments
- Professional Indemnity – design/spec advice and negligence allegations (economic loss exposures)
- Cyber / IT / OT – outages, ransomware and digital liability (scope varies)
- Legal Expenses – contract/employment disputes support (scope varies)
Property, Stock & Work in Progress (WIP)
Property insurance is designed to cover physical loss or damage to insured property caused by insured events (such as fire, flood, escape of water, storm and theft), subject to terms, conditions and exclusions. For PCB manufacturers, the core issue is values: a small shelf of ICs can be worth more than a room full of generic stock.
You also need to think about WIP. Multi-layer panels can carry a lot of value before they’re saleable. Underinsurance can create painful claim outcomes, especially where average conditions apply.
What It Typically Covers
- Buildings (if insured) and tenant improvements
- Contents, racking, fixtures and office equipment
- Stock and WIP (raw materials, panels, components, assemblies)
- Theft cover where selected and security conditions are met
- Options to include accidental damage (varies by insurer)
Common PCB-Specific Pitfalls
- Stock/WIP values set to “average” not peak
- Customer components not insured (customers’ goods missing)
- Security conditions not aligned to actual storage practices
- Assuming “scrap/yield loss” is covered without an insured peril trigger
- Not documenting critical spares or long lead-time items
Business Interruption (BI) & Loss of Income
BI is designed to protect your gross profit (or another agreed basis) after an insured interruption, subject to the policy wording. In PCB manufacturing, two decisions matter most: the indemnity period and the declared BI figure.
If your recovery depends on specialist equipment, re-commissioning, QA validation and customer re-approval, the true recovery timeline can exceed 12 months. Choosing too short an indemnity period is one of the most common (and most expensive) mistakes.
BI Cover Elements
- Loss of gross profit / loss of income during downtime
- Increased cost of working to reduce disruption (scope varies)
- Alternative premises / subcontracting costs (where included)
- Extensions: denial of access, utilities (where included)
PCB BI “Reality Checks”
- What’s the longest lead-time machine you rely on?
- How long to validate and restart processes after a major incident?
- Will customers require re-approval before resuming supply?
- Can you outsource production temporarily — and at what margin impact?
Public Liability vs Products Liability vs Professional Indemnity
Liability is where PCB programmes often fail “quietly” — because you can have a certificate that looks right, but the territory, jurisdiction, or scope doesn’t match where your products actually go or what you actually do.
The simplest way to think about it: Public is what happens at your premises/operations, Products is what happens because of the product you supplied, and PI is what happens because of advice/design/specification work.
Public & Products Liability
- Third-party injury/property damage arising from operations
- Legal liability for damage/injury caused by defective products (subject to wording)
- Territory/jurisdiction aligned to exports and customer requirements
- Limit level aligned to contracts (commonly £2m/£5m/£10m)
Professional Indemnity (PI)
- Negligence allegations relating to professional services/advice
- Economic loss exposures (often not covered by products liability)
- Relevant if you provide DFM advice, spec sign-off, design input or consultancy
- Retroactive cover, notifications and claims-made rules matter
Specialist Areas That Often Matter in PCB (But Get Missed)
These areas don’t apply to every business — but when they apply, they can be the difference between a programme that works and a programme that leaves you exposed.
Customers’ Goods & High-Value Consignment
If you hold customer-owned components (common in PCBA), you need a customers’ goods limit based on peak exposure. Contracts often allocate responsibility regardless of whether you “own” the parts.
- Set limits to peak customer component values onsite
- Segregation, records and access controls support better underwriting
- Clarify responsibility during storage, WIP and in production
Equipment Breakdown & Bottleneck Planning
If breakdown is your real downtime driver, build the programme around it — not just fire/flood. Think: compressors, extraction, reflow ovens, AOI/X-ray, test rigs, and specialist utilities.
- Equipment schedule with replacement values and maintenance controls
- Consider alignment of breakdown with BI where structured
- Spare parts strategy and service contracts matter
Transit & Export Exposure
High-value shipments are a common “silent” exposure. A single lost consignment can wipe out margin and cause late delivery issues.
- Transit limits set to maximum consignment values
- Territories aligned to where you ship and where claims could arise
- Packaging and tracking procedures help underwriting
Cyber / OT & Traceability Dependence
If ERP/traceability downtime stops production, cyber is a practical operational cover — not just a “data” cover. Scope varies widely; ensure it fits your operational dependency.
- System outage and incident response costs (where included)
- Third-party liability if data is compromised (where included)
- Backups, MFA and patching posture influence underwriting
The explanation we got elsewhere was “you’ve got property, liability and BI” — but nobody talked about customer consignment stock or our single test bottleneck. Insure24 broke it down properly and rebuilt the programme around our real risks.
Operations Director, UK PCBA ManufacturerGET CLARITY (AND A PROGRAMME THAT ACTUALLY FITS)
- Explain each cover and how it applies to PCB fabrication and PCBA/SMT
- Set realistic stock/WIP and customers’ goods limits (based on peaks)
- Align BI indemnity periods to realistic recovery timelines
- Match liability territories and limits to contracts and exports
- Add equipment breakdown and cyber where they’re real downtime drivers
- Reduce gaps by aligning wordings in one coherent programme
FREQUENTLY ASKED QUESTIONS
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What is PCB manufacturing insurance?
It’s a set of commercial insurance covers structured around PCB fabrication and PCBA/SMT risks — typically property/stock, business interruption,
employers’ liability and public/products liability, with specialist add-ons such as customers’ goods, equipment breakdown, transit, PI and cyber where relevant.
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Why are stock and WIP values so important for PCB businesses?
PCB value can concentrate in compact components and multi-stage WIP. If values are understated, underinsurance can reduce claim settlements under “average”
conditions. Using realistic peak values helps avoid nasty surprises.
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What’s the difference between products liability and professional indemnity?
Products liability relates to injury or property damage caused by the products you supply (subject to policy terms). Professional indemnity relates to
negligence allegations from professional advice/services, often involving economic loss. Many PCB businesses need one or both depending on what they do.
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Does insurance cover scrap, yield loss, or latent defects?
Often only where there is an insured peril trigger (e.g., fire/flood/theft) or specific extensions — policy wordings vary and many “process loss” or
pure quality defects may be excluded under standard property covers. We’ll help you understand what is and isn’t insurable for your scenarios.
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How do I choose a BI indemnity period for a PCB factory?
Start with worst-case recovery time: rebuild, replace machinery, recommission, validate, and regain customer approvals.
Many PCB businesses consider 12–24 months; some require longer. The right period depends on your operation and bottlenecks.
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How can Insure24 help with PCB manufacturing insurance?
We map your exposures (values, bottlenecks, customer goods, exports and contracts), present the risk clearly to suitable insurers, and structure a coherent
programme to reduce gaps. Call 0330 127 2333 or use the quote form to get started.