When in possession of others assets, it is always important to ensure that the liability an individual or company has for those assets. This is where bailee liability insurance comes into play.
Many businesses assume that traditional business insurance policies cover all properties, including those that aren’t owned by said business. However, because the property belongs to others, it traditionally isn’t covered by a standard policy. Bailee liability insurance, however, is the answer to these potential gaps in coverage.
Unlike some other types of business liability insurance, bailee liability insurance has the benefit of covering the assets and property during the entire tenure that it is under that company’s possession, including when it is on or in transit to and from the person who temporarily has control of the property, also known as the bailee.
This means that this type of insurance in an invaluable asset to many companies, such as freight companies that are delivering customers’ goods, banks that hold bonds, storage companies where many people tend to store their furniture, files, and potentially other valuables, or even kennels or a horse ranch individuals will leave their pets for an extended stay.
While the cost is potentially greater for this type of coverage, the potential loss if that coverage is not in place might be even greater, which makes the investment worth it in the long run, especially for smaller businesses or entities who aren’t making as much capital as some of the larger businesses.
Under a contract, the bailee has certain rights such as being able to retain and use the property that they are entrusted with. However, the bailee also has a large number of responsibilities in order to ensure minimal negligence or carelessness on their part. Any gross negligence on their part will result in a gap in coverage by their insurance.
In the long run though, having this insurance can only benefit everyone involved because it protects all parties from liability claims, which can only encourage more companies to take on the role of a bailee when an individual or group needs to retain those types of services.