What is a life science stock throughput policy (STP)?

A Life Science Stock Throughput Policy (STP) is an insurance contract developed exclusively for our life science industry insureds. The life science field is a vast category that includes companies that provide research, development, manufacturing services, and products, such as pharmaceuticals, medical devices, biologics, and vaccines.

Distributing these products that can be highly sensitive or have unique handling exposures requires specialized shipping methods. Helping to maintain their quality, integrity, and efficacy during transit. If proper care isn’t taken, these products can deteriorate, expire, or spoil, creating a critical loss for the company and especially the patients they are designed to serve. This is where life science stock throughput policies come into play.  

Life science stock throughput policy: explained

A life science stock throughput policy protects pharmaceutical, biomedical, biotechnical, and nutraceutical companies’ assets against physical loss or damage during transit and while at manufacturing and storage locations. This life science stock throughput policy is specially designed to address the unique challenges and risks associated with the transport and storage of life science shipments from raw materials through work in process to finished goods until their ultimate final mile delivery to customers.  

These products are often vulnerable to extremes in temperature, may be sensitive to light and humidity, or have a short lifespan. This means even seemingly minor disturbances or delays in transit could compromise their integrity and lead to losses—not only financial loss due to missed milestones or missed sales but especially the interruption of care or loss of life, as many patients rely on these time-critical shipments.  

Examples of risks that are hazardous to life science shipments

• Exposure to light 
• Temperature fluctuations 
• Theft 
• Tampering 
• Transit delays beyond the Insured’s control 
• Power outages 

Human error is a frequent cause of loss that is often preventable. From insufficient or improper packaging to incorrect temperature maintenance to not following an insured’s written instructions.  While not always insurable, these types of losses are often preventable through written Statements of Work that identify: 

• Proper packaging, labeling, and handling  
• Vetting and contracting with logistic providers 
• Assessing shipping lane routes and devices for tracking shipments 
• Active and passive devices for monitoring and controlling required temperatures.  

Our loss prevention team works with our insureds to provide specialized expertise including review and development of current best practices and recommendations for improvement to avoid uninsurable losses at all points throughout the supply chain. 

Falvey’s life science stock throughput coverage

Falvey Insurance Group Underwriters and Claims Specialists understand the unique challenges of transporting life science cargo and are here to work with your clients to provide best-in-class coverage and knowledgeable claims handling. Coverage begins with a Marine Cargo & Stock Throughput policy, which is written to address product integrity throughout the supply chain, including valuable extensions such as coverage for delay, flexible valuation to meet the needs of the client, control of damaged goods, and extra expenses. Contact us today to learn more about our coverage.