What Kind of Needs Are Covered by a Insurance Policy for Product Liability?


A Products Liability Insurance Policy is a specialized type of small business insurance coverage that protects business owners from any damages caused to customers through the process of using such a product after purchase.

Product liability is an issue that cuts across almost all kinds of businesses; therefore, they all need to be properly covered by a product liability insurance policy.

This insurance coverage provides protection for manufacturers, importers, wholesalers, retailers, suppliers as well as repairers of manufactured products against product liabilities.

If your business involves any of the ones mentioned
above, you will have to make sure it is covered by this
product liability insurance coverage policy.

As a business owner, you have the responsibility to ensure that whatever product, you manufacture or sell, is of very good quality at all times. This is because any damage to customers resulting from the use of such a product may count against you.

Therefore, if you are responsible of sells, repairs or replacement of manufactured products or parts, you should be careful with what you buy for sale and ensure that all repairs or replacements are perfectly done so that you do not have to be held responsible for product liabilities.

Three Reasons You Could Face Judgments in Product Liability Cases

As a business owner, and especially as a manufacturer, there are three typical scenarios in which you might be facing a judgment arising from product liability. These scenarios can each result in a claim that would require strict product liability coverage to protect the business.

The first is a human error during the manufacturing process. This could include a single part or component of the product being defective or the omission of a crucial part of the product. If the party suing you for abnormally damages or injury arising from a defective product can prove that you deviated from specs or standards while creating the product, you could be facing a large claim.

The second scenario is when instructions and/or warnings are left off of the packaging or are not clear enough. A common issue here is that of language translation. When your instructions and warnings are translated into other languages for foreign packaging, do they mean the same thing?

The last scenario that can commonly induce a large products liability claim is simply that your design is flawed. Sometimes there is no human error, no lack of warnings; it is simply an element of the design that is lacking in safety. Often, this is because a manufacturer is too quick to market a product and doesn’t spend enough time in testing.

Since product liability is an issue that affects almost all types of businesses, it is only wise that every business owner ensures that his or her business is well covered by a product liability insurance policy. You will be more at peace knowing that your business is secured, especially from product liability.

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