Things can and often do go wrong when moving or storing goods. Bailee insurance provides protection from loss in the event of damage to the goods entrusted to storage and transport companies.
Coverage in Standard Liability Contracts
Bailee insurance is typically broad in coverage, and includes damages that result from natural disaster or inclement weather, such as fire, flood, lightning or earthquake. Additionally, such manmade perils as theft, vandalism and collision are typically covered. Bailee insurance contracts are often written to cover negligent acts on the part of the bailee, which can greatly simplify things for all parties by removing the troublesome need to prove or disprove negligence in court.
Additional Coverage Considerations
Something that is not universally part of bailee liability insurance contracts is legal defense. In the event that a bailor pursues damages above and beyond the value of lost goods, coverage for legal defense saves the bailee from having to pay legal fees that may amount to more than the total value of the lost or damaged items. A second area of coverage that may not be covered in all contracts is the cost of clean-up of damaged goods. In the event that damage results in environmental hazard, for example, coverage for costly clean-up procedures will save the bailee a significant amount of money.
The business of storing, handling or transporting other peoples goods entails great risk to operators. Bailee insurance protects businesses from catastrophic liability claims. Operators should examine their insurance contracts closely to limit their liability when caring for customer property.