Wholesaler insurance

A straightforward guide for UK wholesalers

Wholesaler insurance protects the operational backbone of your business - stock, premises, people, vehicles, and your liability to others. If you hold goods, run a warehouse, arrange distribution, or manage a supply chain, the right cover helps keep cash flow steady after a loss and supports contractual obligations with retailers and suppliers. It cannot remove risk entirely, but it can reduce the financial shock when something goes wrong.

In 2025 the UK market is softening, with overall insurance rates down and particularly strong competition in property and cyber lines. That can mean more affordable premiums, though it often comes with tighter underwriting focus and sharper questions about your risk controls. London Market capacity remains resilient, supporting complex or higher-limit placements when needed.

This guide explains the main cover types for wholesalers, where exclusions commonly sit, how claims typically run, and what to check before you buy. We also highlight regulatory expectations for wholesale brokers and evolving dispute themes in cyber and construction-related risks that can affect policy language and claims outcomes. The aim is simple: plain-English clarity so you can make informed, safe decisions.

Insurance can offer real financial protection, but only when you understand what is covered - and where the gaps are.

A good policy blends core protections with sensible add-ons, backed by evidence of sound risk management. With careful comparison you can use current market conditions to improve terms without weakening resilience.

What is covered in practice and how a claim works

Most wholesalers start with property cover for buildings, fixtures, and stock at the warehouse, including seasonal stock increases and goods in transit. Business interruption can replace lost gross profit if a covered event stops operations, helping you pay wages, rent, and supplier invoices while you recover. Liability policies protect against injury or damage claims from employees, visitors, and third parties. Many firms add product liability for goods supplied, professional indemnity if you provide technical advice, and cyber cover for data breaches or system outages.

Policies have limits, deductibles, and exclusions. Common exclusions include gradual wear and tear, poor maintenance, intentional acts, and certain cyber events unless specifically endorsed. Flood or subsidence may need additional terms depending on your postcode. Product recall is usually separate. If you operate cold storage, check for deterioration of stock and outage extensions.

When a claim occurs, notify your insurer or broker promptly, take reasonable steps to prevent further loss, and keep evidence such as photos, repair quotes, stock records, and contract paperwork. Loss adjusters may visit for larger claims. For business interruption, robust accounts and realistic indemnity periods are essential. With cyber incidents, quick engagement with your insurer’s breach response panel helps limit damage and evidence costs.

Market context matters. Recent reductions in property and cyber rates can improve affordability, but some casualty covers are holding firm or easing only selectively. Expect underwriters to ask more about supply chain dependencies, construction standards post-Grenfell changes, and your controls for financial crime.

Who benefits from this cover

Wholesaler insurance suits businesses that buy, store, and distribute goods - from fast-moving consumer products to building materials and specialist components. It is useful for firms with significant stock values, multiple storage sites, temperature-controlled goods, or contractual liabilities to retailers. Companies that rely on just-in-time delivery or operate a fleet will also benefit, as interruptions can quickly affect customers and revenue.

Smaller traders with minimal stock, no premises, and low turnover might need lighter protection, focusing on public liability, product liability, and basic contents. Where goods are drop-shipped without your custody, stock cover may be unnecessary, though contract terms should be reviewed carefully. If you provide design, configuration, or technical advice, professional indemnity is often prudent.

The goal is suitability, not excess. Choose cover that matches your risk profile, not a bundle that looks comprehensive but does not reflect how you operate.

Pick your cover levels with confidence

1. Core - Essential

   • What it includes: Property for contents and stock, goods in transit, public liability, employers’ liability, and basic cyber incident response.
   • Who it suits: Start-ups and smaller wholesalers with single-site operations and low to moderate stock values.
   • Key limits: Lower sums insured and standard deductibles. Optional seasonal stock uplifts.

2. Core Plus - Balanced

   • What it includes: All Core features plus business interruption on gross profit, product liability with higher limits, enhanced goods in transit, and selected cyber extensions.
   • Who it suits: Growing firms, multi-site storage, or higher throughput where downtime would quickly impact orders.
   • Key limits: Mid-tier property limits, 12-24 month indemnity period, higher product liability limits.

3. Advanced - Comprehensive

   • What it includes: Broad property including stock deterioration, machinery breakdown, full cyber with ransomware and business interruption, professional indemnity for advice, and management liability.
   • Who it suits: Complex supply chains, temperature-controlled operations, or contractual liability requirements from major retailers.
   • Key limits: Higher aggregate limits, bespoke deductibles, and London Market support for excess layers.

4. Optional add-ons

   • Product recall and crisis costs - where brand protection matters.
   • Marine cargo and stock throughput - for continuous cover from supplier to customer.
   • Fleet or motor liability - for owned and hired vehicles.
   • Trade credit - to manage non-payment risk from buyers.
   • Terrorism - for locations or contracts that require it.

What influences price - typical trends

Pricing is sensitive to market cycles. Recently, property and cyber rates have seen notable reductions, while some casualty lines vary by exposure. Good risk data and practical controls typically achieve better terms.

Who is eligible and what you will need

Most UK wholesalers trading as limited companies, partnerships, or sole traders can apply. Insurers may set minimum standards for premises maintenance, security, and health and safety procedures. If you manage temperature-controlled stock, expect questions about monitoring and backup systems. For cyber cover, multi-factor authentication and secure backups are commonly required.

You will usually be asked for recent accounts, stock values and turnover, details of goods handled, site construction, fire and security protections, claims history, and any contracts that impose specific insurance terms. Declines typically relate to poor claims experience with no remedial action, serious criminal or regulatory issues, high natural catastrophe exposure without mitigation, or gaps in key controls like fire protection or cyber hygiene.

Being transparent at application helps avoid cover disputes later and speeds up claims should you need to make one.

From quote to claim - a simple path

1. Gather key information - turnover, stock values, sites, security, and claims history.
2. Request quotes via a broker or marketplace and share supporting documents.
3. Compare cover limits, exclusions, deductibles, and indemnity periods line by line.
4. Confirm adjustments - seasonal stock, transit limits, and any required endorsements.
5. Bind the policy and schedule risk improvements with clear target dates.
6. Maintain records and test incident response, especially for fire and cyber.
7. If a loss occurs, notify promptly and preserve evidence for the adjuster.
8. Track claim progress and keep cash flow plans updated during recovery.

Advantages and trade-offs at a glance

Strong governance and clear evidence often unlock better outcomes in both pricing and claims.

Checks to make before you commit

Read policy schedules carefully and confirm sums insured, indemnity periods, and transit limits match your operations. Check deductibles are affordable in a bad month, not just on paper. Understand key exclusions such as gradual deterioration, product recall, and specific cyber events unless endorsed. Confirm any security or maintenance warranties are realistic and already met. Review renewal pricing mechanisms and how claims may affect next-year terms. Keep copies of risk surveys, valuations, and contracts that impose insurance conditions.

Alternatives and related protections

1. Commercial combined insurance - a simpler package if your operations are small and low risk.
2. Marine cargo and stock throughput - suitable when goods move continuously across borders or storage points.
3. Trade credit insurance - when buyer default would strain working capital.
4. Management liability - for director and officer exposures and regulatory investigations.
5. Self-insured retention or captives - for larger firms with strong risk management and predictable losses.

Frequently asked questions

Q: Do I need business interruption or just property cover? A: Property pays for physical loss. Business interruption replaces lost profit and fixed costs after a covered event. If a short outage would harm cash flow, interruption cover is usually worthwhile.

Q: How long should my indemnity period be? A: Choose a realistic timeframe to restore turnover, not just to repair buildings. Many wholesalers select 12-24 months to allow for machinery lead times, supplier onboarding, and customer retention.

Q: Are cyber risks really relevant to wholesalers? A: Yes. Ransomware, supplier portal compromise, and invoice fraud are common. Strong controls and appropriate cyber cover can limit downtime and forensic costs, with incident response support.

Q: What affects my premium most? A: Stock values, construction and fire protections, claims history, and your risk controls are key. Market conditions also play a role, with recent competition helping property and cyber pricing.

Q: Will product recall be included automatically? A: Usually not. It is commonly an optional add-on. Standard product liability addresses injury or damage claims, while recall pays for withdrawal, replacement, and crisis management costs.

Q: Can I get higher limits for retailer contracts? A: Often yes. Insurers can place higher limits or excess layers. Complex requirements may involve the London Market, especially for large product liability or transit exposures.

Q: What compliance expectations should I be aware of? A: Regulators expect robust financial crime controls, liquidity planning, and sound governance. Keeping accurate records and following stated warranties helps avoid coverage issues at claim time.

What to do next

If this cover fits your needs, gather your risk information and compare quotes with a trusted broker. Focus on limits, exclusions, and indemnity periods rather than price alone. Current market conditions can be favourable, but suitability comes first. You stay in control by choosing the cover that matches your risks and budget.

Important note

This guide provides general information, not personal financial advice. Policy terms vary by insurer and your circumstances. Always review the wording, exclusions, limits, and warranties carefully, and seek professional guidance if you are unsure.