Insurers are often faced with claims for stock which has been damaged whilst being temporarily held at premises other than the risk address. The temporary removal clause provides cover for property insured whilst temporarily removed from the risk address or location to other premises including whilst in transit. The words “temporarily removed” in relation to stock means “taken away for a short time with the intention of returning it.”

In an unreported February 2007 case of CNS Agents & Distributors CC vs Nova Risk Partners Ltd (Durban High Court, case number AR 254/2006; judgment 16 February 2007), the court held that for stock to fall under the temporary removal clause it would have to, in the first place, have been accepted as such for storage at the risk address and, secondly, to have been removed for safekeeping elsewhere pending its return for continued storage at the risk address.

The insured was stocking up for Christmas in October 2003 and the stock was delivered by truck to its insured premises, entered as stock in its accounting systems and then forwarded to other premises used by it from time to time elsewhere. In these circumstances, said the court, there was no temporary removal.  The insured was not entitled, for the premium paid for stock which it accommodated at the risk address, to insurance cover for stock which it had no intention of storing at its main premises. Stock first delivered to and kept at overflow premises is not covered by the temporary removal clause.