Stockpiling over Brexit Fears? Make sure you inform your Broker
We work with many businesses and it is clear that, as the uncertainty over Brexit doesn’t seem to be going away quickly, that some businesses are looking to stockpiling raw materials and goods, indeed many are already doing so and have been for some time. In terms of robustly protecting the business, this would initially appear to be a sensible approach, however, stockpiling can bring risks of its own.
There are factors that need to be considered to ensure stockpiling procedures don’t create issues:
- Review your storage practices – temporary stockpiling is often carried out in existing premises and as a result, increases the likelihood of materials and goods being stored in hazardous or unsafe conditions. It is essential to consider safety and ensure your stockpile storage space and practices maintain proper risk controls.
- Increase security measures — Stockpiling can potentially increase the risk of theft; your supply of goods will likely exceed distribution rates for a period and may be located in a single storage area. As a result, make sure you implement proper security measures (e.g. guards, security cameras and restricted access barriers) to prevent break-ins and stolen or damaged stock.
- Inform your insurer — importantly, your insurer will need to know that you have put the above measures in place, but stockpiling may well bring with it an increased insurance risker in the event of a claim. Your stock sum insured and your contents (potential for additional racking) may need to be reviewed, with each you will normally have some flexibility in the numbers, but it is sensible to make the call. You should also consider the potential for goods being exported and the need to ensure you are still insuring for the correct territories. None of this should present any issues in changing your policy, but you could have issues if you fail to keep insurers advised.
If you would like any further information or would like to talk to one of our team please get in touch.