Does Your Business Need Product Liability Insurance?
You have a great idea, manufacture and sell a quality product. You work hard to make sure your products are the best. But there is still a chance your product could fail or be misused causing injury property damage. Businesses who sell products, whether they are manufactured by you or made by someone else, could be held responsible for paying damages.
That’s why you need product liability insurance. Depending on your business type product liability coverage can be included in your business’s general liability insurance policy.
If your company sells:
- Edible products - you could have a claim for a client’s allergic reaction.
- Children’s products - you could have a suffocation or choking claim.
- Hardware products - injury or damage to someone or someone’s property.
There is always the potential for defects that can result in property damage or bodily injury to your customers. A claim neither you or customers can afford. That’s why all businesses that sell products should have product liability coverage. Find out what product liability insurance is and how much your small business might need:
Product liability insurance protects businesses from the financial loss that occurs in the event that a product causes injury or other damage to third parties. Even if a product is used incorrectly, your business could still be liable for any damage that results.
Claims can come from all across the country or world depending on where you sell your products. The size of the lawsuit awards in 2020 have increased significantly over the previous years.
With an increase in claims and the high cost of lawsuits, product liability coverage has become all the more important for small businesses. Product liability insurance covers the legal fees, compensatory, medical costs and business damages. It can also cover the recall of your products if found defective.
The cost of product liability insurance can depend on the amount of sales of your product, the type of product and how many products you sell.
The more you sell the greater the likelihood one of the products could have some type of defect.
As your small business grows, this could become a bigger concern over time.
Typically, your vendors will require this coverage too in order for you to sell or represent your product in their stores.
Product liability insurance is a must even if your role in the manufacturing, sale or distribution process is marginal. Talk to an agent today to make sure you’re covered.