Stock Deterioration Insurance

Deterioration of stock contained in a controlled environment is a significant cost for life science businesses

How safe is your R&D material? The contents of your freezers may represent months of valuable R&D time – and without Stock Deterioration insurance, a malfunction could screw up project timelines and hit your revenue.

Insuring “property” in the biopharmaceutical sector differs hugely from risks of other sectors. A key area of concern for manufacture and research organizations is storage of refrigerated stock: losses arising from a change in controlled environment (malfunction or breakdown of fridges or freezers, dewars running dry) can be very costly, and an integrated risk management program is crucial.

Assessing the Risk

It’s important to evaluate how business-critical the contents of refrigeration units are. They may represent months of valuable research and development time, and losses might impact on revenue and clients’ R&D operations.

• The type of perishable property stored in each refrigeration unit
• Critical temperature thresholds: the refrigerator manufacturer guidelines will outline how quickly the unit would lose temperature if power failed.
• Estimated cost and time to replace the property?
• Could production be maintained if one or more units failed?
• Implications for customer relations and revenue?
• Review current controls and how are these checked, implemented and kept up-to-date?