Bonded warehouse insurance (antrepo sigortası) covers both the protection of goods held in a customs warehouse against risks such as fire, flood and theft, and the warehouse operator's liability arising from those goods. A loss of goods under customs control can bring the suspended customs duties into play in addition to the value of the goods. For this reason, the operator's and the cargo owner's policies are structured separately.
Is bonded warehouse insurance a single policy?
No. In practice, "bonded warehouse insurance" means three separate layers of cover, each with a different insured party:
- Cargo owner's goods policy: Insures the goods in the warehouse themselves against risks such as fire, lightning, explosion, flood, earthquake and theft. If the stock value fluctuates, a declaration (reporting) policy is used.
- Operator's liability policy: Covers the warehouse operator's legal liability for goods belonging to third parties; handling errors, wrong delivery and lack of supervision fall under this cover.
- Building and facility policy: Protects the warehouse building, racking systems and equipment; it does not cover customers' goods inside.
The types of cover are largely the same as for ordinary warehouse insurance; what makes a bonded warehouse different is the customs status of the goods.
How does the customs duty risk affect the sum insured?
Duties on goods in a bonded warehouse are suspended. Under Article 208 of the Customs Law (Gümrük Kanunu), if the goods are destroyed or lost because of their nature, unforeseeable circumstances or force majeure, the customs debt is extinguished; no duty is charged on goods completely burnt in a fire. Theft, an unexplained shortage or an unrecorded removal, however, give rise to duty. In that case the loss has two components: the goods themselves and the duty that must be paid.
This distinction is reflected in the policy structure as follows: the sum insured under the goods policy is usually set on the duty-free value of the goods (CIF plus costs). Since any part of the sum insured that exceeds the insurable value is void, adding the duty to the sum insured from the outset does not always work. Adding a separate item or special condition to the policy for the duty arising in the event of theft is the better route.
Why is the warehouse operator liable, and what does its guarantee protect?
Under Article 96 of the Customs Law, the operator is responsible for keeping the goods under customs supervision and fulfilling the storage obligations. Under Article 98 of the Law, the customs administration takes a guarantee from the operator. This guarantee secures the state's duty claim; it does not compensate the cargo owner's loss. Who bears the liability depends on the warehouse type:
| Warehouse type | Who is liable for the duty on missing goods? | Insurance consequence |
|---|---|---|
| Type A public warehouse | The operator who keeps the stock records | The operator's liability policy should also cover the duty |
| Type B public warehouse | The user; the operator only rents out the space | The cargo owner should address the duty risk in its own policy |
| Type C, D, E private warehouse | Operator and user are the same person | Goods and duty risk are structured together in one policy |
The types are defined in Article 329 of the Customs Regulation (Gümrük Yönetmeliği); before signing a storage contract, ask which type of bonded warehouse the goods will be placed in.
Why should the cargo owner take out a separate policy?
The operator's liability depends on fault. In an earthquake, a flood or a fire spreading from a neighbouring facility, if the operator is not at fault, the cargo owner cannot obtain compensation. Storage contracts also often contain liability limits per kilogram or per event. Marine cargo insurance carried over from the transport, on the other hand, is valid in the warehouse only for a limited time: under the General Conditions of Cargo Transport Insurance (Emtea Nakliyat Sigortası Genel Şartları), cover ends when the goods are delivered to the consignee at destination, when they are placed in a warehouse if delivery is prevented, and in any case at the end of the 15th day after discharge. Goods that will wait in a bonded warehouse for weeks need separate storage cover.
Points to check in the policy
- Are the warehouse address and customs warehouse code correctly written in the policy?
- Have the additional covers for earthquake, flood and theft been taken out?
- In cold stores, is spoilage caused by temperature changes covered?
- Have customs duties, storage charges and debris removal costs been added to the cover separately?
- Is the deductible appropriate for the stock structure?
Policies for bonded warehouse stock can also be assessed under storage insurance.