Liga Asuransi – In any business supply chain, a warehouse is more than just a place to store goods. It’s the heart of operations, where all logistics, distribution, and storage activities converge before the product reaches the customer. Without a properly functioning warehouse, production can grind to a halt, deliveries can be delayed, and cash flow can be disrupted.
As 2025 approaches, Indonesia is set to witness a significant surge in industrial and trade activity. Warehouse areas such as Marunda, Cikarang, Karawang, and Surabaya are bustling with the flow of goods from various sectors—from manufacturing and electronics to e-commerce logistics. However, behind this surge lies an often-overlooked reality: many companies still lack adequate property insurance coverage for their warehouses.
However, warehouse risks cannot be underestimated. In recent years, fires, floods, and damage caused by electrical short circuits have become increasingly frequent, causing losses reaching billions of rupiah. Ironically, most business owners only realize the importance of insurance after a disaster strikes.
Imagine if tens of billions of dollars’ worth of inventory were lost overnight in a fire—with no financial protection to support it. In such a situation, a business could be paralyzed instantly.
This is where property insurance becomes crucial, not just a formality, but a lifeline for businesses in the worst of times. To ensure effective protection, the presence of a professional insurance broker like L&G Insurance Broker is key.
L&G Insurance Broker is here to help companies comprehensively understand warehouse risks and design an insurance program that aligns with the value of your assets and the nature of your business operations. Because in today’s fast-paced and uncertain business world, not having property insurance is like setting a time bomb in your own warehouse.
Why Warehouses Are High-Risk Assets
The warehouse may look like an ordinary building—large, sturdy, and filled with piles of goods. But behind those steel and concrete walls, there’s a hidden treasure.a major risk that could shake the company’s financial stability at any time.
Many business owners think that because warehouses are rarely visited or not operating 24 hours a day, the risk is low. In fact, the opposite is true. Warehouses arehigh-risk assets, because the value of the goods stored is usually very large, while supervision is often limited.
Here are some of the key risks lurking in warehouses in Indonesia — especially as we approach the end of 2025, when industrial activity is at its peak:
1. Fire and Explosion
Fire remains the leading cause of losses in the warehousing sector. Most incidents originate frompoorly maintained electrical installations, short circuits in the cooling machine, or human errorsuch as cigarette butts and the use of welding equipment in unsafe areas.
- Real example:In media reports in mid-2025, a fire at a logistics warehouse in the Cikarang industrial area caused losses of more thanRp. 80 billion, because the stock of electronics and vehicle spare parts burned down.
- Without property insurance, such a large loss would have to be borne entirely by the company, which could lead to bankruptcy.
2. Floods and Extreme Weather
Global climate change is making rainfall in Indonesia increasingly erratic. Many large industrial areas such asBekasi, Karawang, and North Surabayais now prone to flooding due to poor drainage and massive development without water management planning. Floods not only damage buildings, but alsodestroying stock of goods and important documents.
Without a property insurance policy that covers flooding, losses from a single inundation could cost hundreds of millions to billions of rupiah.
3. Theft and Vandalism
The risk of theft increases in warehouse areas with high traffic and minimal security. High-value items such as electronic components, automotive spare parts, or imported raw materials are prime targets.
In addition, vandalism or damage by outside parties — for example due to demonstrations or sabotage — is also a real threat, especially in dense industrial areas.
4. Engine and Support System Damage
Many warehouses now feature automation systems, conveyor belts, and cold storage for efficiency. However, when these machines fail due to power outages or technical failures, the impact can be significant:
- Distribution activities stopped.
- Items are perishable or expired.
- Repair costs are skyrocketing.
5. Additional Risks: Human Error and Force Majeure
Not all losses result from major disasters. Human error, such as incorrectly stacking goods, forklift operator negligence, or using heavy equipment without proper operating procedures, can also cause significant damage.
In addition, the risk of force majeure such as earthquakes and fires caused by lightning strikes is still often ignored even though the impact is very fatal.
In short, a warehouse is more than just storage space—it’s a vital asset with a high level of risk and complexity. Without proper protection, one small incident can wipe out years of profits.
Case Studies and Facts on the Ground
In recent years, Indonesia has recorded several warehouse fires and damage cases that have resulted in significant losses for businesses. One example was a warehouse fire in the Cikarang industrial area in 2024, which resulted in losses amounting to tens of billions of rupiah. The warehouse stored chemicals and plastic raw materials, but apparently did not have an active insurance policy because the coverage had expired.
As a result, the company had to cover all recovery costs itself, including replacing inventory, repairing buildings, and even paying salaries to employees who were unable to work during the recovery period. This case serves as a stark lesson that without insurance protection, a single incident can wipe out years of hard work.
On the other hand, there are also examples of companies that have comprehensive insurance coverage. A logistics distribution company in the Marunda area experienced a minor fire in its storage area, but its insurance claim was quickly approved—recovering approximately Rp 7 billion in losses in less than two months. This allowed them to quickly repair the facility and resume operations without major disruption.
Field data also shows that over 40% of warehouses in Indonesia are inadequately insured. Many warehouse owners only insure the building, omitting coverage for the contents or potential loss of profits due to operational disruptions. Yet, the value of the warehouse contents is often far greater than the value of the building itself.
The Strategic Role of Insurance Brokers in Protecting Your Warehouse
Many companies still assume that purchasing insurance can be done directly without professional assistance. However, every insurance policy contains technical details and important clauses that can significantly impact the validity of future claims. This is where the role of a professional insurance broker becomes crucial.
Insurance brokers are not just intermediaries, but risk advisors who act on behalf of clients, not insurance companies. They help ensure every aspect of coverage truly reflects your business’s circumstances and needs.
Here are the strategic roles of insurance brokers that warehouse owners often don’t realize:
- Comprehensive Risk Analysis (Risk Mapping)
Brokers help identify potential hazards in the warehouse, ranging from fire, electrical short circuits, floods, to the risk of theft. - Tailor-Made Policy
Each warehouse has different characteristics—size, location, type of goods, and even security systems. Brokers adjust insurance coverage to prevent underinsurance or overlap. - Negotiating Premiums and Coverage with Insurance
Brokers represent your interests in negotiating with insurance companies to obtain efficient premiums and maximum benefits. - MentoringClaims Advocacy
Moment riskIf this happens, the broker will accompany the claims process so that it runs quickly, transparently, and in accordance with your rights as the insured. - Periodic Review and Policy Update
Brokers also ensure your policy is always relevant to the latest business conditions, asset values, and risk developments in the field.
With the support of an experienced insurance broker, companies can focus more on operations and business development — without having to worry about unexpected risks that threaten the warehouse.
Conclusion and Recommendations
Running a business with a warehouse without insurance coverage is like walking a tightrope without a safety net. As long as everything seems fine, risks are often ignored—until one day, disaster strikes without warning. Fire, flood, theft, or equipment failure can shut down operations in an instant and cause billions of rupiah in losses.
Through various cases in Indonesia over the past few years, we can see that insurance is not just a means of compensation for losses, but also a strategic tool for maintaining business continuity. Companies with appropriate property insurance coverage have been shown to recover more quickly, maintain their reputations, and continue operations without major disruptions.
Therefore, the best step you can take before the end of this year is to ensure your warehouse and all company assets are protected by appropriate property insurance policies. Don’t wait for risks to arise—prevent them before it’s too late.
As an independent insurance broker with over 30 years of experience, L&G Insurance Broker has helped various companies in the industrial, manufacturing, logistics, and trading sectors to obtain appropriate and efficient warehouse and commercial property insurance coverage.
📞 Contact L&G Insurance Broker at0811-8507-773 for a free consultation and find insurance solutions that protect your assets, reputation and business future.
