A wholesaler owns a great deal of stock for a short time and sells it to businesses on credit. Both halves of that sentence are insurance problems, and a third arrives because the law treats a distributor as part of the supply chain.
Products liability without making anything
A wholesaler that cannot identify who supplied a defective product can be treated as its producer, and one that imports into the United Kingdom is a producer outright. That means products liability applies even though nothing was manufactured. Supplier records, batch traceability and conformity documentation are what pass liability back up the chain, and they are also what an insurer asks about, because without them the wholesaler is the last solvent party standing.
Stock, peaks and the warehouse
Stock is the largest single figure on the policy and it moves constantly. The sum insured needs to reflect the peak, either declared or through a seasonal clause, because the condition of average reduces every claim where it is short. Warehouse fire risk is about how goods are stored as much as what they are: rack height, sprinkler design, combustibility, and where forklift and equipment batteries are charged.
Credit, and customers who do not pay
Selling to trade customers on terms means the largest realistic loss in a year may be a customer's insolvency rather than a fire. Trade credit cover answers for that, per buyer and within limits the insurer sets, and it comes with reporting and stop supply conditions. A wholesaler with concentration in a few large accounts is the clearest case for it, and can see from its own aged debtors report where the concentration is.
Transit, delivery and goods held for others
Stock moving in and out needs goods in transit cover, whether on own vehicles or with carriers, and a carrier's standard conditions limit their liability by weight rather than value. Where the business holds stock for customers or operates any fulfilment, that is goods in trust rather than own stock. Delivery vehicles need the right class of use, and drivers doing multi drop work carry the injury profile that goes with it.
Questions people ask about wholesaler insurance
Does a wholesaler need products liability?
Yes. An importer is a producer in law, and a distributor that cannot identify its supplier can be treated as one, so the exposure exists without manufacturing anything.
How should stock be insured?
At the peak value, declared or through a seasonal increase clause, because the condition of average reduces every claim where the sum insured is short.
What covers a customer going insolvent?
Trade credit insurance, written per buyer within limits the insurer sets, with reporting and stop supply conditions attached.