OSHA’s accidents page is packed with examples of LPG mishaps: employees dying from carbon monoxide overexposure, propane explosions, and severe burns from leaks.
These incidents don’t just affect LPG delivery businesses and employees—customers can be impacted too, and sometimes, LPG distributors end up in court.
Take the tragic case of the Howe family in North Dakota. A propane explosion in 2016 killed Mr. and Mrs. Howe and injured one of their children. The propane supplier, CHS, was dismissed from the lawsuit, the retailer, Tri-Energy Cooperative, faced legal challenges. This case highlights the importance of due diligence and the right insurance coverage to protect your business from such devastating scenarios. This case might have taken place a long time ago, but was closed only at the end of 2021. This means that the retailer not only suffered penalties but also 5 long years of paying legal fees.
For your LPG delivery business to thrive, you need to stay out of trouble. In this blog, we’ll look at:
- Risks you may not have thought of
- How to handle them better with propane delivery insurance
Is Your LPG Business Protected Against These 7 Risks?
Safety Lapses
In the North Dakota CHS case, Tri-Energy Cooperative did not supply gas detectors, which contributed to the explosion. Ensuring your partners complete due diligence is crucial, but even then, accidents can happen. General and professional liability insurance can protect your LPG gas delivery business in such instances.
General liability insurance can cover third-party claims for bodily injury or property damage, while professional liability insurance protects against claims of negligence or errors in your services.
Without these coverages in your LPG insurance policy, your business could face devastating financial losses from lawsuits, medical expenses, or property repairs, potentially jeopardizing your operations and reputation.
By accepting workers’ compensation benefits, the employee waives the right to sue their employer for damages. You proactively take care of your employees instead of making them fight for it—this might also contribute to helping them feel a sense of loyalty to your business.
Employee Accidents
LPG gas distributor employees perform a dangerous job that takes a cumulative toll over time—think of all the bending and lifting. Worker’s compensation insurance gives them the confidence to carry out their risky tasks day in and day out by covering medical expenses, rehabilitation costs, and lost wages if they’re injured on the job.
Without this type of LPG insurance, your business could face costly lawsuits, employee dissatisfaction, and potential regulatory penalties, all of which could disrupt operations and harm your reputation.
High-Risk Operations
Your workspace is more flammable than most. You’re literally sitting on tons of flammable gas. Commercial property insurance is a must to cover damage to your facilities, equipment, and inventory in case of fire, explosions, or other disasters.
Additionally, if you deliver the wrong product, the consequences can be severe—misdelivery of liquid products coverage can help mitigate this risk by covering damages or legal claims arising from such errors.
Without these protections within your LPG gas insurance policy, a single mistake or accident could lead to catastrophic financial losses, lawsuits, and even the shutdown of your business.
Delays and Non-Deliveries
LPG powers large-scale operations, and delays for LPG gas deliveries to businesses—for whatever reason—can cause significant losses for your customers, who could sue for damages.
While professional liability insurance within a propane delivery insurance package is helpful, failure-to-supply coverage is still more effective as a coverage option, as it specifically addresses losses caused by delivery interruptions. Without professional liability or failure-to-supply coverage, your business could face hefty legal claims, reputational damage, and strained customer relationships, all of which could cripple your operations.
On-Road Risks
An accident involving LPG cylinders can be far more serious than one involving vehicles not carrying flammable gas. Insuring your business vehicles is essential, as damages could be much higher if an accident causes an LPG explosion.
Commercial auto insurance covers vehicle repairs, medical expenses, and liability claims, while specialized endorsements can address the unique risks of transporting hazardous materials. Without this coverage, a single accident could result in astronomical costs and legal battles for your LPG distribution business, and even the loss of your fleet.
Compounding Risks
Because you deal with a product that can be explosive under the wrong conditions, LPG accidents can cause tremendous loss of property and even life.
Umbrella insurance and excess liability insurance are must-haves for all LPG distributors, as they provide additional coverage beyond your primary policies, protecting you from massive claims that could otherwise bankrupt your business. For added protection, consider specialized LPG insurance coverage like broadened pollution liability coverage, which addresses environmental damage claims.
Without these safeguards, a major incident could lead to insurmountable financial and legal challenges. How can your business thrive when you can barely keep your head above water financially?
Cyber Threats
If you accept online payments, cyber threats and data theft are real lawsuit risks. Cases have already been filed! Recent examples include the University of Minnesota being sued for failing to safeguard private information, Advocate Aurora Health settling for $12.25 million after a 2022 data breach, and Tampa General Hospital facing a class-action lawsuit over the compromise of 1.2 million patient files.
Cyber liability insurance can protect your LPG delivery business from such costly incidents by covering data recovery, legal fees, and customer notifications. Without this coverage within your propane delivery insurance package, a cyberattack could result in financial ruin, loss of customer trust, and regulatory penalties.
Why Specialized LPG Insurance is a Must
Some jobs and supplier partnerships might mandate insurance, but general business insurance often isn’t designed for high-risk businesses like yours. Look for specialized insurance tailored to the LPG industry.
PropanePro, for example, offers a comprehensive insurance program with coverages that include:
- General liability
- Commercial auto
- Excess liability
- Workers’ compensation
- Property and inland marine
Additionally, it covers:
- Propane operations GL extension endorsement
- Business auto coverage expansion endorsement
- Propane property enhancement endorsement
- Broadened pollution liability coverage
- Misdelivery of liquid products coverage
- Failure-to-supply coverage
PropanePro LPG insurance is run by NIP Group, and has an “A” rating from A.M. Best, PropanePro provides best-in-class claims handling and tailored risk control services. We launched this program with your risks and challenges in mind—you can rest assured that PropanePro is current, contextualized and comprehensive. We’ve also funnelled extensive LPG sector expertise to ensure accurate valuation of your operations, property, and equipment when planning your cover.
Don’t wait for an accident to realize the importance of insurance. Read all about PropanePro’s tailored solutions and ask your broker to sign you up today—contact us if you have any questions.
FAQs
- What types of insurance do LPG delivery businesses need?
LPG businesses need general liability, commercial auto, workers’ compensation, property insurance, and specialized coverages like pollution liability and misdelivery protection. - Why is specialized insurance better than general business insurance oolicies for LPG delivery businesses?
Specialized insurance is designed for high-risk industries like LPG, offering tailored coverage for unique risks such as explosions, pollution, and misdeliveries. - How can insurance protect against cyber threats?
Cyber liability insurance covers costs related to data breaches, lawsuits, and recovery efforts, safeguarding your business from financial losses. - What makes PropanePro a good choice for LPG insurance?
PropanePro offers comprehensive, industry-specific coverage, an “A” rating from A.M. Best, and expert risk control guidance tailored to LPG businesses.
