Staying in business is one good reason why your business needs products liability insurance coverage. If you are sued, you could lose everything, and it might not even be something your company produced!
Product liability insurance is needed for all types of
businesses, even if they are just a middleman.
If a product you sell is involved in an accident that causes bodily injury or property damage, the lawyers look at everything that could possibly be a cause of that accident.
Product defects and product failures are two main sources of personal injury and property damage that result in people suing the company that made or sold that product.
If a product that is part of something that you sell fails, you are still liable for the proper functioning of that piece of equipment, even if you bought it from someone else.
Product liability insurance protects your company in the event of a lawsuit arising from product defects and liability.
This includes the production of the product, product design flaws, and everything else including having protective safety labeling on the product.
If you neglect to put a label advising of possible danger or proper use of the product, you can be held liable. Even with labeling, you may be part of a product failure lawsuit.
For best protection, and to stay in business, be sure you have adequate product liability coverage. Many general insurance policies include some product liability coverage.
Be sure you have enough coverage for all you do. If you are a distributor, a refurbisher, or seller of products, you need this type of insurance.
Some accidents are not your company’s fault, but you can still be in the legal line of fire if you have anything to do with the faulty product.
Product liability insurance is something that is highly recommended for product-based business owners
to acquire as they begin in the business world.
It’s important to make sure that your business is covered and protected against lawsuits and other potentially damaging circumstances but what is product liability, and why does a business need insurance against it?
At its core definition, product liability is the legal responsibility of manufacturers and vendors to provide compensation to purchasers, users, and sometimes even bystanders who were injured or suffered damages due do a defect or defects in the product or goods that were purchased.
Although most of the time the ultimate liability rests on the manufacturer for defects in products sold, responsibility to compensate can also fall on the retailer, and occasionally on other entities like wholesalers, middlemen, or even certifiers.
Most of the time compensation is required when a person files a lawsuit because of damages or injuries sustained because of a defective product. The lawsuit is ordinarily directed at the manufacturer, but could also be directed to the retailer.
And then, depending on the outcome of the lawsuit, a judgment can be awarded and the manufacturer or supplier or other party deemed to be responsible must pay.
When there are implications of defective products on business operations, this is where product liability insurance comes into play.
Product liability insurance protects manufacturers and suppliers on the occasions of claims being made for damages incurred or injuries received while using their products or goods.
Be sure you are adequately insured!