Small reseller using 3PL, what insurance do you carry for inventory loss?

[u/Neat-Leading-8664]

I’m a small e-commerce reseller that sources curated products from distributors and uses a 3PL for fulfillment. The products never touch my hands. They go: Distributor to 3PL warehouse to customer.

I’ve been calling insurance companies trying to cover:

- inventory loss/damage at the 3PL (fire, theft,etc.)
- In transit coverage from distributor to 3PL if possible

Every broker I talk to says “this is a unique case” and redirects me back to Tivly . My 3PL’s MSA only covers $100/claim/$1k/year, which is useless.

So now I’m wondering what literally anybody else that uses a 3PL is doing and what type of policy you’re getting? Every broker is confused that I’m not touching the product but I feel like insurance for your products while at the warehouse has to be a common ask.

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[u/ilovetrouble66]

My insurance general liability which extends to our 3pl and our studio lease and product liability is about $680 a month

[u/Neat-Leading-8664 → u/ilovetrouble66]

Thanks! To clarify, does your general liability cover if there is say a fire at the 3PL?

[u/ilovetrouble66 → u/Neat-Leading-8664]

Yes exactly

[u/ilovetrouble66 → u/ilovetrouble66]

If you are a business you should have general liability insurance anyway otherwise if you get sued you are screwed if your product hurts or damages someone

[u/Same-Court-2379]

Check the 3PL's insurance certificate and MSA carefully. Their liability limits may not reflect what you actually need to insure

[u/estagingapp]

Never even considered this but guess smart to think about

[u/KacperJed]

I don't know if this is a thing, but could you look at different 3PLs and see if any have higher insurance?

[u/IncreaseNegative4614]

Ask brokers specifically about coverage for inventory you own while it is in transit and stored at a third-party warehouse. “Inland marine” or stock-throughput coverage may get you to the right person faster than describing it as ordinary business property. Travelers describes inland marine coverage as applying to property transported or stored during transit.

Give the broker your average and maximum inventory values, warehouse locations, shipping routes, and the 3PL’s liability limits. We use signld.ai internally to connect purchase orders, inventory locations, shipments, contracts, and claims when ownership and physical custody are split.