If the answer is no, or if you are wondering,
“What is product liability insurance?” Don’t worry!
That’s why we’re here! And, we want to tell you all about it.
We live in a litigious world where almost anything could threaten your small business. It’s important you understand the specifics behind your insurance and how the details could potentially help you and your business in the case of a lawsuit.
Now, to answer your question.
What Is Product Liability Insurance?
Product liability insurance is designed to protect your business from two kinds of claims:
- Lawsuits, accidents, or negative reactions arising from products sold, distributed, or manufactured
- Third-party claims such as bodily injury and property damage losses arising out of a defect in the product your business sold, manufactured, or distributed
What Does Product Liability Insurance Do For Me And When Would I Use It?
As we mentioned, your product liability insurance would likely cover you and your assets in the event of a third-party liability claim arising from defective products. This means that if a product you made, sold, labeled, or altered caused bodily harm or physical injury to another individual, you could be on the hook. Let’s review some real claims our customers have filed with us:
- A claimant sued one of our customers after they alleged that a conditioner they purchased and used from them caused permanent hair loss.
- A customer of ours was selling improperly labeled food at an event, someone sampled some and had an allergic reaction to what was served and they sued.
- Another customer of ours was sued by a client of theirs after a face and neck peel they used on them allegedly caused burns on the client’s skin.
What Does Product Liability Not Cover?
Like all insurance types, product liability insurance carries exclusions. To have a better idea of what your policy covers, make sure you review and understand your policy with your agent when you purchase. Many times, exclusions to insurance are covered by another type of small business insurance, so if one kind of insurance doesn’t pick up a claim, another kind possibly could—be sure to check with your agent. Here are some exclusions and the insurance that could respond if product liability can’t:
Employee injuries:Work-related employee injuries are covered by workers compensation insurance. Most businesses are actually legally obligated to carry this type of insurance, make sure you purchase employee injury insurance.
Slips and falls on business property:These types of accidents are covered by your general liability insurance and we’ll give you more details below.
What Other Benefits Does Carrying Product Liability Insurance Give Me?You might not know this, but oftentimes your product liability insurance is tied in with a general liability insurance policy. This means that along with the coverage provided by your product liability insurance, you are also covered for general liability claims as well. Thus, you would have coverage in place if a product you sold caused someone harm, or a bodily injury or property damage suit was to be filed against you, such as a slip and fall accident. General liability insurance primarily protects you from most liability claims for bodily injury and property damage arising out of your business operations. It may also provide coverage for personal and advertising injury claims. That being said, your general liability policy could respond if any of the following were to occur:
- A customer slips and falls in your store causing them to break a bone.
- Equipment in your store falls and hurts a customer.
- A fire is started in the building.
Breaking Into Retail
Carrying product liability insurance can help you meet requirements for getting into retail spaces, whether that be online or brick and mortar.
Many times as you apply to sell your products in a retail space you’ll see, “Please provide proof of insurance.”
Don’t let that scare you!
At Insurance Canopy, we understand the requirements big retailers are looking for and we’re here to help you understand as well as bridge the insurance gap.
Through our efforts, we’ve actually helped business owners break into retail spaces such as Target, Whole Foods, Ulta Beauty, Petco, Rite Aide, Amazon.com, Walmart.com, and so many more! And, with over a decade of supplier-to-retailer experience, you can bet our team will try their best to get you the coverage you need.
Why Insurance Canopy Is Your Solution For Product Liability Insurance
Insurance Canopy is dedicated to providing manufacturers, importers, and distributors with customizable policies for consumer, commercial, and industrial goods. We’re here to help you assess the specific risks associated with your industry and customize the product liability coverage your business needs.
We have the ability to provide insurance solutions for small businesses in the most niche industries carrying a wide range of products. Our covered industries range from vitamins and dietary supplements, beauty products, and vape and e-cig equipment, to emerging CBD topical and ingestible products and cannabis goods.
With our product knowledge and expertise, you can rest easy knowing that someone is taking care of your insurance needs.
Our application is completely online and can be filled in just a few minutes, ensuring you a quote turn-around time of no more than four business days and sometimes in as little as one.
Don’t leave your business vulnerable, and apply for your product liability insurance policy today.