A trader without insurance = a ticking time bomb. One incident — a warehouse fire, a lost shipment, a buyer going bankrupt — can destroy your business. Commercial insurance in Saudi Arabia has evolved significantly, now offering options for every business size.
1. Cargo Insurance
Covers loss/damage during shipping. Cost: 0.15-0.5% of shipment value.
- ILU Clauses A (All Risks): Highest cost, most comprehensive coverage.
- Clauses B: Covers named perils only (fire, sinking, explosion).
- Clauses C: Lowest cost, least coverage.
2. General Liability Insurance
Protects against third-party claims (damage, injury). Cost: 2,000-15,000 SAR annually depending on activity.
3. Trade Credit Insurance
The most important for B2B traders. Covers buyer non-payment (bankruptcy, chronic delay). Cost: 0.3-1.2% of insured sales volume. Providers in Saudi Arabia: ATLAS Insurance, Commercial Insurance, ATRADIUS.
4. Fire and Property Insurance
Often mandatory for commercial lease agreements. Cost: 0.05-0.2% of property value.
5. When Is Insurance a Necessity, Not a Luxury?
- Shipments > 50,000 SAR = Mandatory cargo insurance.
- Warehouse > 200 m² = Mandatory fire insurance.
- Net-30/60 sales = Recommended credit insurance.
- Products that may cause harm = Mandatory liability insurance.
The smart alternative to paid insurance: Trade Assurance on Wershop — protects both buyer and seller in every transaction with no monthly premiums.