Bailee’s insurance coverage

If you operate a business that takes temporary possession of other people’s property, then you need the protection offered by bailee’s coverage.

From dry cleaners to movers, many different types of businesses take custody or temporary control of property belonging to other people. Without bailee’s coverage, you could be left paying for their property if it is damaged or ruined while you’ve got it in your possession.

Let’s start by defining a bailee: a bailee is any company or person that temporarily has custody or control of someone else’s property. So the client or person who truly owns the property may be called the bailor since they are putting their property in your care. Should anything happen to your client’s property while it is in your care, this is when your business needs to have the special type of insurance protection offered by bailee’s coverage. Your property insurance covers your possessions only and does not cover property you do not own, even if your client’s property is in your company vehicle or business location. And most general liability policies exclude coverage for items not owned by the policyholder.

Bailee’s coverage protects your business from loss when the property of others in your care is damaged or destroyed by fire, sprinkler systems, theft, or some type of damage during transport to and from your location.

There are many businesses that temporarily take possession of other’s property, such as:

If you’re not sure what insurance protection you already have or if bailee’s coverage actually applies to your particular business, speak with one of our brokers.