Warehousing goods is an important and vital part of the distribution chain existing between the manufacturer or importer, and the consumer. Large shipments of goods generally sit in warehouses until merchants and retailers require the restocking of their inventories. This method is designed to regulate the distribution of goods while monitoring supplies and availability.
A warehouse operator engages in the practice of receiving and storing the goods of others for an agreed upon price. These goods, while in their care, are now their responsibility, and any damages or losses occurring would then require compensation be made to the owner of those goods. By accepting items for storage and safekeeping, an operator could end up liable for theft, hazardous conditions, or the potential for contamination of goods in his or her care. Orlando warehouse legal liability insurance is designed to address these concerns.
Field warehousing essential to US commerce
Warehousing has become a vast and vital industry with federal and state laws governing the liability and practices of warehousemen. These laws set forth the measure of a warehouse operator’s responsibility for stored goods, provide for inspection and regulate the issuance of warehouse receipts which are often used as security for loans.
Manufacturers, jobbers, and wholesalers are, in one particular instance, able to borrow money on the security of stock inventories that physically remain on their premises or storage facility. This is known as “field warehousing”. Those owning certain goods are now placing a warehouse operator in technical possession of their goods by leasing a portion of the premises where goods will be stored to the operator.
The warehouse operator will then issue a warehouse receipt whereas it may be stipulated that these goods are to be delivered under specified conditions to a lending institution on their order. The receipt thus becomes collateral for a financing arrangement. The bank is fully protected since the pledge of the warehouse receipt is just as effective as would be a pledge of the goods themselves.
In short, Orlando warehouse legal liability insurance policies cover the legal liability of an insured as a warehouse operator or bailee with respect to physical loss or damage to property of customers of the assured at specified locations subject to designated limits.