SWG CGL: Understanding Wholesalers Insurance Requirements

Sep 2020

SWG CGL: Understanding Wholesalers Insurance Requirements

Is your client a product middleman? Wholesalers have specific insurance requirements and need a tailored policy that covers all the risk factors to their property, products, employees, equipment, and vehicles.

In a story from Canadian Underwriter Magazine last year, a restaurant lost business because it served meat from a batch later discovered to be unsafe. Mr. Sub Canada launched a class-action lawsuit against Maple Leaf Foods for allegedly providing ready-to-eat meat products that later tested positive for listeriosis in 2008. The outbreak killed 22 people and rendered 50 people seriously ill.

Although Mr. Sub could not prove that any of its customers was directly harmed by any contaminated product, the franchise alleged that some of its customers decided not to buy Mr. Sub products because of the outbreak. The court debated over whether the supplier was liable to the restaurant for its “economic loss due to a tarnished reputation.” (1)

Who Needs Wholesalers Insurance?

Whether it’s a mom and pop shop or a Canada-wide franchise, every company distributing products to customers for resale needs this type of coverage. South Western Group’s specialized CGL policy can cover the following categories:

  1. Cross liability: Cross liability ensures coverage for the insured against another party insured under the same contract.
  2. Contingent employer’s liability: Contingent liability insurance is insurance protection against potential perils or obligations that may or may not come to be, depending on how a particular event turns out. This type of insurance is often used to protect against the possibility that an event would result in the insured owing a large sum of money.
  3. Product Completed Operations coverage (Broad Form): This insurance extension makes it so that the CGL policy covers all property damaged by the negligent work of a contractor, including the parts of their work that were not defective or performed negligently but damaged as a result.

A wholesaler’s insurance options will depend on their unique business risk factors. For example, wholesalers should provide their insurance brokers with information about what kinds of products they distribute, whether they are perishable and/or fragile, how large the operation is, and what kind of delivery services they provide. Knowing these factors and others will determine the company’s insurance needs.

SWG CGL Protects Your Client’s Hard Work with a Policy that Fits Their Needs

SWG CGL – Commercial General Liability insurance is designed to protect the products or services of small and large businesses. As careful as wholesalers might be, there are unforeseen events that can happen to every business.

Whether your client is a store owner, office professional or wholesaler, commercial general liability insurance coverages can be customized to protect your client against the unique risks and exposures they face.

SWG CGL – Commercial General Liability policy can protect businesses from financial loss should they be liable for property damage or personal and advertising injury caused by their services, business operations or their employees. It can cover non-professional negligent acts for which they might become responsible.

Coverage Highlights:

  • Cross liability
  • Contingent employer’s liability
  • Product Completed Operations coverage (Broad Form)
  • Our policies are on occurrence form, we can however also offer claims made option
  • Our policies can offer enhancement coverage to include, Faulty Workmanship, Product Recall coverage, Employee Benefit, Employer’s Comprehensive Bodily Injury Liability, Sub-limits for Errors & Omissions, as well as Manufacturer’s E&O and Employment Practices Liability
  • Limits up to $10,000,000
  • Deductibles start at $1,000 and can be customized to the size of the business or type of operation
  • Coverage can be provided for sales into the U.S. and Worldwide

Other coverages are available. Visit our CGL product page for more details.

Content is current as of the date of broadcast and is subject to change without notice.


  1. https://www.canadianunderwriter.ca/legal/supreme-court-of-canada-mulls-liability-for-reputational-harm-from-tainted-meat-1004169797/