Protect Your Packaging Business With the Right Insurance

Packaging businesses play a crucial role in supply chains across industries—from food and beverage to electronics and retail. Whether manufacturing packaging materials or acting as a broker, day-to-day operations come with complex risks.

Transportation delays, raw material shortages, inflation, production disruptions, and equipment breakdowns are just a few challenges that can quickly impact profitability. That’s why having the right insurance coverage isn’t just smart—it’s essential.

In this article, we’ll explore key insurance policies you may need to consider as a packaging business owner, with expert tips from Kim Aber, commercial lines underwriter at Central Insurance.

Commercial Property Insurance Can Shield Your Packaging Business Facility Inside and Out

Packaging companies often operate in large facilities with expensive, specialized equipment. Commercial property insurance can provide coverage for losses from fire, many types of weather events, vandalism, and theft.

“If your building is destroyed or your machines are damaged, this coverage can keep you from financial ruin,” Aber states.

Packaging businesses face a unique combination of operational and physical risks.

“Transportation delays are one of the most common pain points for packaging businesses,” Aber explains. “So is damage to the facility—if something happens to the building or machinery, the whole operation can come to a standstill.”

Endorsements like business income coverage, which reimburses lost net income and extra expenses if you have a slowdown in business operations due to a covered loss to property, can be added to commercial property insurance for added protection. This coverage is especially critical for many businesses including packaging companies, that rely on high-volume output and consistent uptime.

That’s why it’s essential to take proactive steps that minimize the risk of shutdowns and strengthen your insurance profile. Regular inspections, equipment maintenance, and facility upkeep reduce claim potential and may result in better insurance rates.

“Documenting maintenance, installing safeguards like fire alarms or sprinkler systems, and staying proactive is key,” Aber advises. “Insurance carriers want to see that you’re invested in preventing losses, not just reacting to them.”

General Liability is Your Packaging Business’s Front Line of Defense

General liability coverage protects against claims of bodily injury or property damage on your premises or caused by your products or operations. If a client or delivery driver is injured at your facility, or a product defect causes damage, this coverage can respond.

Aber notes that packaging companies often overlook liability exposures off-site, such as attending trade shows or delivering materials. Even if an incident happens away from your facility, it could still be connected to your operations and leave your business at risk. General liability coverage helps provide peace of mind and protects you wherever your business takes you.

For packaging companies with high liability exposure, umbrella insurance is an additional and vital safety net to consider. It offers an added layer of protection beyond your base policies’ liability limits.

“If a severe liability claim maxes out your general liability or auto limits, your umbrella policy can kick in to cover the rest,” Aber notes.

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Keep Your Packaging Business at Full Capacity with Equipment Breakdown Coverage

Modern packaging equipment is complex and often automated. When it fails, repairs can be costly and time-consuming. Equipment breakdown coverage can cover the repair or replacement of critical machinery due to a covered accident, and may even extend to office equipment like computers and printers.

Even with routine maintenance, unexpected issues like electrical surges, motor burnout, or mechanical failures can bring operations to a halt.

“For packaging businesses, downtime isn’t just an inconvenience—it can mean lost contracts, delayed shipments, and damaged customer relationships,” she shares.

This coverage can help you get back up and running quickly, minimizing financial loss and disruption to your operations.

Workers’ Compensation Safeguards Your Packaging Business Workforce

Your employees are your most valuable asset. Workers’ Compensation insurance covers medical expenses and lost wages if a worker is injured due to job-related causes. This coverage is essential for packaging businesses, where employees often handle machinery or perform repetitive tasks.

Don’t Overlook Digital Risks Associated With Your Packaging Business

Cyber threats are becoming a growing concern as more packaging companies adopt digital systems to manage supply chains and track shipments. Ransomware, data breaches, and social engineering attacks can paralyze operations.

“Hackers are looking for payment data, customer info—anything they can sell or exploit,” she states.

Cyber Suite coverage from Central can help protect against these risks and can help cover the costs of data recovery, legal fees, and notification requirements.

Coverage on the Move: Transportation and Cargo Insurance Needs 

If your packaging business handles its shipping, you’ll need commercial auto insurance to cover your fleet. Cargo insurance is also important—it can protect your products while in transit. “Think of cargo insurance like property coverage for goods that are on the move,” Aber explains.

Depending on your operations, mobile equipment coverage from forklifts to trailers may also be necessary. She recommends discussing your operations with your independent Central agent to ensure your business has comprehensive coverage.

The Central Difference

To reduce financial risks and increase resilience, businesses must ensure comprehensive coverage for all their physical assets, employees, and operations. That’s why it’s important to partner with a company like Central Insurance, which has been helping businesses protect what matters most for nearly 150 years.

With a network of nearly 400 hand-selected agency partners across the U.S. and nationally recognized claims and service teams, Central delivers personalized protection with a commitment to long-term relationships. Through regular coverage reviews and support from loss control experts, Central works closely with packaging businesses to ensure their policies evolve as their operations grow.

Talk to your local Central agent today to review your current policies and ensure you’re covered for what’s next.