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THE ESSENTIAL PCB INSURANCE COVERS (IN PLAIN ENGLISH)
Insurance for PCB Manufacturers: What Cover Do You Actually Need?
PCB manufacturing is high-value, high-precision and (often) contract-led. The risk profile is different from general manufacturing because a lot of your value sits in compact stock and work-in-progress, your downtime can be driven by specialist plant, and quality issues can create downstream liability and customer disputes.
The “right” insurance programme is the one that matches your operation: are you fabricating boards, assembling PCBs (PCBA/SMT), or doing both? Do you hold customer-supplied components? Do you export? Are you supplying higher-reliability sectors? How dependent are you on a small number of machines?
Below is a practical guide to the core covers most PCB manufacturers consider — and the common gaps that catch businesses out. Final cover always depends on underwriting, the insurer’s wording, and how your contracts allocate responsibility.
The Core Insurance Covers Most PCB Manufacturers Need
Most PCB businesses build their programme around a combined policy (or a tightly coordinated set of policies) that covers: property/stock, business interruption, employers’ liability, and public/products liability. These four cover areas address the biggest loss drivers: site incidents, stolen/damaged stock, downtime, employee injury, and third-party claims arising from operations or products.
Where PCB manufacturers differ is in the detail: customers’ goods exposure, export territories, high-value consignment stock, equipment breakdown dependency, and whether design/specification advice creates professional indemnity exposure.
1) Property, Buildings, Contents, Stock & WIP
Property insurance protects your premises (if insured), contents and stock against insured events such as fire, flood, escape of water, storm and theft, subject to policy terms and conditions. For PCB businesses the key is ensuring values reflect reality — especially peak stock and WIP.
- Buildings (if you insure them) and tenant improvements
- Contents: benches, racking, office equipment, small tools
- Stock and WIP: raw materials, panels, components, assemblies
- High-value compact items: ICs, modules, specialist components
- Security and fire protection conditions aligned to how you operate
2) Business Interruption & Loss of Income
BI protects your cashflow after an insured disruption (often linked to material damage), subject to wording. In PCB, the biggest issues are (a) choosing an indemnity period that’s too short, and (b) under-declaring gross profit exposure.
- Loss of gross profit (or agreed basis) during downtime
- Increased cost of working options to keep deliveries moving
- Indemnity period aligned to rebuild + re-commission + re-approval time
- Consideration of bottlenecks: press, reflow, AOI/X-ray, test rigs
- Extensions (where available): denial of access, utilities disruption
3) Employers’ Liability (EL)
EL is usually required if you employ staff in the UK (subject to exemptions). For PCB operations it should reflect real hazards: machinery, manual handling, solder fumes/chemicals, vehicle movements and contractor exposure.
- Legal liability for employee injury/illness (subject to policy terms)
- Defence costs for covered claims
- Clear treatment of temps/agency and labour-only subcontractors
- Works alongside risk assessments, training and maintenance records
4) Public & Products Liability
Public liability addresses third-party injury/property damage from your operations. Products liability addresses legal liability for damage or injury caused by products you supply (subject to terms). PCB contracts often set minimum limits and territory requirements.
- Third-party injury/property damage claims (operations)
- Products liability for defective boards/assemblies causing damage
- Territory and jurisdiction aligned to exports (USA/Canada exposure matters)
- Contractual liability: understand what you’re agreeing to
Common Add-ons for PCB Fabricators & PCBA/SMT Businesses
Beyond the core covers, the “right” extras depend on how you trade, what you hold, and what your contracts demand. Many PCB businesses carry exposures that aren’t obvious until a loss happens — such as customer-owned parts on the shelf, expensive test rigs, or shipments with high single-consignment values.
Customers’ Goods (Consignment Components & Tooling)
If customers supply components or own tooling stored at your site, you may be responsible under contract. Customers’ goods cover is designed to insure customer-owned property while it’s in your care, custody or control (subject to wording). Limits should reflect peak exposure, not averages.
- Customer-supplied ICs and high-value components
- Customer-owned jigs, fixtures and tooling
- Clear record-keeping and segregation supporting underwriting
- Security and access controls aligned to high-value storage
Equipment Breakdown & Engineering Risks
If one machine stoppage can halt production, equipment breakdown should be considered. It can cover sudden and unforeseen breakdown of insured plant (where arranged) and is often paired with BI to address downtime losses.
- Pick-and-place, AOI/X-ray, reflow ovens, selective solder
- Test rigs, calibration equipment, environmental chambers
- Utilities: compressors, extraction, chilled water systems
- Spare parts strategy and maintenance records support better terms
Goods in Transit
PCBs and components are high value and sensitive. If you ship frequently (or send boards to subcontractors for coating, machining or test), goods in transit can protect consignments (subject to wording) and prevent a single shipment loss turning into a major financial hit.
- Set limits to realistic maximum consignments
- Consider import/export movements and couriers used
- Packaging and tracking procedures help underwriting
Professional Indemnity (PI)
If you provide design input, DFM advice, component selection guidance or specification sign-off, you may have PI exposure. PI responds to allegations of negligence in professional services (subject to wording), which is different from products liability.
- Design-for-manufacture advice and specification changes
- Engineering consultancy and prototype guidance
- Mis-specification allegations and economic loss exposures
Cyber / IT / OT Disruption
Many PCB businesses rely on ERP, traceability, CAM/programming, and customer portals. Ransomware or a serious IT incident can stop production even if the factory is physically intact. Cyber cover varies widely — it’s worth aligning it to your operational reality.
- Ransomware and business interruption from system outage (where included)
- Data restoration and incident response costs (where included)
- Third-party liability if data is compromised (where included)
Product Recall / Rectification (Where Available)
Some businesses explore recall/rectification solutions for controlled withdrawal or field correction costs. Availability and scope vary significantly by insurer and risk profile. If your contracts are strict, it’s worth reviewing what is and isn’t insurable.
- Field failures and controlled withdrawal scenarios
- Quality containment and customer communication costs (if covered)
- Often requires strong QA systems and traceability
How to Build the Right PCB Insurance Programme
The fastest way to a strong programme is to map your real “loss scenarios” and then structure the policy around them: what could stop production, what values are at risk, and what a worst-case recovery timeline looks like.
For PCB businesses, this usually comes down to: (1) fire/water/theft severity, (2) bottleneck breakdown, (3) customer goods exposure, and (4) liability exposure driven by where your products end up and what they could damage.
Questions We’ll Ask (And Why)
- Do you fabricate, assemble, or both? (risk profile and bottlenecks differ)
- What’s your peak stock/WIP and what drives peaks?
- Do you hold customer components/tooling? What are the peak values?
- What’s the single most critical machine or capability?
- Where do you ship? Any USA/Canada exposure?
- What limits do customers require? What’s in your contracts?
- What protections exist: fire alarms, sprinklers, security, housekeeping, extraction?
Documents That Speed Up Underwriting
- Latest accounts or management figures (turnover and margin)
- Equipment schedule with replacement values and service arrangements
- Stock/WIP/customer goods values (average and peak)
- Premises details, protections and photos (where helpful)
- Claims history and any quality incident narrative
- Contracts/tender requirements (limits, territories, endorsements)
- Quality/traceability overview (especially for higher-reliability sectors)
Once we mapped our real exposures — customer consignment, a single AOI bottleneck, and peak stock values — the insurance structure finally made sense. Insure24 helped us present it properly and avoid the usual gaps.
Finance Director, UK PCB ManufacturerGET THE RIGHT COVER (WITHOUT THE GAPS)
- Build a combined programme aligned to your processes, contracts and exports
- Protect stock/WIP and set customer goods limits to realistic peak exposures
- Safeguard cashflow with BI and the right indemnity period
- Add equipment breakdown where machine failure is the real downtime driver
- Include PI where design/spec advice creates professional exposure
- Reduce underwriting delays with a clear, specialist risk presentation
FREQUENTLY ASKED QUESTIONS
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What are the most important insurance covers for a PCB manufacturer?
Most PCB manufacturers consider a core set of covers: property/stock, business interruption, employers’ liability and public/products liability.
The right “extras” depend on your operation, such as customers’ goods (consignment stock), equipment breakdown, goods in transit, PI and cyber.
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Do PCB manufacturers need customers’ goods insurance?
If you hold customer-supplied components or customer-owned tooling at your premises, you may be responsible under contract. Customers’ goods cover
is designed to insure customer property while in your care, custody or control (subject to wording). Limits should reflect peak exposure.
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Is equipment breakdown important for PCBA/SMT businesses?
Often, yes. If a single machine failure can stop the line (pick-and-place, AOI/X-ray, reflow, compressors, extraction or test rigs),
equipment breakdown is worth considering — and it’s often aligned with BI to address downtime losses, subject to policy terms and underwriting.
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Do I need products liability even if customers supply the design?
Many customers will still require products liability from the manufacturer or assembler supplying the physical product.
Products liability typically responds to legal liability for third-party injury or property damage caused by products, subject to policy wording,
exclusions and territory/jurisdiction. If your role includes design advice, PI may also be relevant.
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How do I set the right stock/WIP and BI values?
Start with realistic peak exposure, not averages. PCB value often concentrates in compact items and multi-layer WIP.
BI values are typically based on gross profit (or an agreed basis). Keeping values updated reduces underinsurance risk.
We can help you translate financials and operational peaks into underwriting-ready figures.
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Can a combined PCB insurance package cover everything in one policy?
A combined programme can bring core covers together and add extensions, which helps reduce gaps. However, some specialist areas (like certain cyber
or recall solutions) may still be separate depending on insurer appetite. The aim is a coherent structure that matches your real exposures.