Product Liability Insurance

Designed to protect your business and help you get into retail stores.​

Whatever Your Contribution, We’ve Got You Covered

Quick Turnaround | Affordable Policies | Experienced Agents | Customizable Coverage

Any business that imports, produces, distributes, or sells products needs product liability insurance. Insurance Canopy has helped thousands of businesses like yours obtain affordable coverage to protect against lawsuits and meet retail requirements. We have also assisted thousands of businesses get products into stores such as Target, Whole Foods, Ulta Beauty, Petco, Rite Aid, Amazon, Walmart, and countless others—both online and in-store.

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  • Overview
  • Coverage Details
  • Premium Cost
  • Examples
  • Canopy Cares
What Is Product Liability Insurance?

Product liability insurance provides financial protection for claims of bodily injury and property damage losses from a product sold, manufactured, or distributed by you or your business. If your business plays a part in the supply chain of a product—whether it be in sales, distribution, installation, or manufacturing—you should be aware of the necessity for retail product insurance. Without insurance, you could be paying thousands of dollars for legal fees, repais, or medical bills all on your own. You may have to halt business or recall products, and you risk damaging your reputation.

Product liability insurance can protect your small business if a product you sold, produced, or distributed leads to:

  • Property damage
  • Illness
  • Injury
  • Death

View our Product Liability e-Book for additional facts, statistics, and information about product liability insurance. 

Who Needs Product Liability Insurance?

If you work with a product at any point in the supply chain, then you need product liability insurance. Whether you handle ingredients, parts, or whole products, you can still be held liable in a claim if the final product causes bodily harm or property damage. Suppliers, manufacturers, distributors, and retailers all face the same liability risks and can benefit from the protection of insurance. See what product liability insurance can do for you below, and learn more about how much product liability insurance may cost in the “Premium Cost” tab. 

  • Suppliers
    Suppliers provide suitable materials to manufacturers so they can create a product. If you supply bad materials, a faulty product may end up on store shelves. This can lead to defects which may injury a consumer, damage their property, or cause an allergic reaction. If you are named in a lawsuit, you can face fines and even loss of business.
  • Manufacturers
    One of the most common product liability claims are from manufacturing defects or mislabeled products. Say you create a product that isn’t properly assembled or labeled before being sold. If a customer sustains injuries from using the item, they can name you, the manufacturer, as responsible in a claim. Without product liability insurance, you may have to pay for the customer’s injuries, defending yourself in court, and recalling the product.
  • Distributors
    Distributors are responsible for circulating products to companies who can sell it. You could be held liable if you damage a product in transit that later harms a consumer. Or, if crosscontamintion occurs while delivering products and someone sustains an allergic reaction. It’s your job to ensure the products you are delivering are quality and safe for consumers, otherwise you are at high risk of facing claims.
  • Retailers
    Customers usually come in contact with a product through retailers, making them prime targets in product liability claims. If a product sample or purchased product leads to bodily injury, choking, allergic reactions, or damages their property, you can be liable to pay for medical bills, legal fees, and more. A single claim can damage your reputation, halt business operations, and even lead to store closures.
The Importance Of Product Liability Insurance For Small Businesses

We live in a litigious society, and the need to protect your business and assets from potential claims and lawsuits is of growing importance. Without product risk insurance, a single claim can cost thousands of dollars and potentially lead to:

  • Product withdrawal
  • Damaged reputation
  • Loss of business relationships
  • Halted or slowed business operations
  • Financial losses
  • And more…

Having the right business product insurance creates a financial safety net so you are prepared when the unexpected occurs. Insurance Canopy is here to be your partner in protecting your products so you can focus on running your business worry-free. 

What Can Product Liability Insurance Protect Me From?

Insurance Canopy’s policy provides coverage for goods or products manufactured, sold, handled, distributed, or disposed of by you and/or your company. We also offer product recall protection in case you need to halt or pause production and issue a recall due to a claim. 

An individual may file a product liability claim for an incident such as bodily injury or property damage caused by the use of your product(s). This can include, but is not limited to, the following:

  • Bodily injury such as a burn, cut, or broken bone caused by the materials or design of your product
  • Choking hazard caused by your product
  • Death from an injury or illness sustained by use of your product
  • Fire damage caused by electrical elements in your product
  • Warning or labeling defects in which a manufacturer fails to provide the appropriate warnings on your product

Even if you have strict product testing and carefully monitor product safety, accidents can still occur. Having product liability insurance helps you protect your reputation, lower or eliminate the cost of claims, and keep business operations running smoothly.

What Products Are Not Covered Under Product Liability Insurance?

While we do try our best to offer you coverage for unique or high-risk products most other insurance companies do not cover, there are some products we cannot insure. 

  • Aerosol products
  • Baby products
  • Products requiring a prescription
  • Any product containing human stem cells
  • Weapons and firearms, including police and military gear
  • Products intended to be injected
  • Anything containing more than 0.3% THC
  • Products containing illegal drugs or alcohol

If you have any questions or concerns about finding coverage for your product, our experienced agents can help assist you and see if we have a policy for you.

Are There Additional Coverages Available?

Yes! Insurance Canopy offers a variety of additional coverages to help meet your needs. This allows you to tailor your policy specifically to your business, and keep you from paying for unnecessary coverages. These coverages can increase your policy premiums depending on how many you add and limits needed.

You can add the following coverages to your policy: 

  • Inland Marine Insurance, which covers products, tools, and equipment while in transit
  • Cyber Liability Insurance, to help you recover stolen data or funds in the case of a cyber or malware attack
  • Product Recall Coverage, for help covering costs in the case of a recall on your product
  • Additional Insureds, which are facilities and other businesses you work with who can be added to your policy for protection against claims
  • Hired/Non Owned Auto Coverage, a coverage for rented or employee vehicles used to conduct business operations
  • Employee Benefits Liability, for help covering any errors or omissions when administering employee benefits
  • Trade-show Coverage, to help cover you while selling your product at trade shows
  • Occurrence Limits, a policy covering damages or injuries that occurred during the policy period, regardless to when the claim was made

After you submit your quote, an insurance agent will be in touch to go over the details of your coverage. You can then discuss the endorsements and limits you need before finalizing your policy.

How Much Does Product Liability Cost?

On average, our customers pay between $800-$1400 for their annual premiums.

The cost of product liability insurance is dependent on a few factors. Our application takes into consideration the following common factors:

  • Industry
  • Size of Business
  • Annual Revenue
  • Limits Required
  • Claims History

Read on to know how they each play a part in your insurance quote.

Industry
Depending on the type of product you design, produce, or sell, your liability policy cost will vary. Some products are riskier to insure than others, and the agent you speak with will likely go over all the details with you. Typically a policy for cannabis business products will cost slightly more than a policy for office equipment products. Riskier products may require higher limits, or other county or state-mandated insurance.
Business Size

How many employees do you have? Is it just you and a partner running a home warehouse? Or do you own a store with multiple employees? The size of your business will affect how much you pay for product liability insurance.

Revenue
Our application will ask you about previous annual revenue and you may be asked about projected revenue. Your past sales will impact your liability insurance quote.
Limits Needed
The limit on your policy is the maximum that your insurance will pay out during any given policy period. Are you looking to meet contract requirements for a retailer? Or are you trying to increase your current insurance limits? Our agents can help you determine the policy limits that meet the needs for retailers or discuss what limits meet your personal/business needs.
Claims History
Insurance is there for when you need to file a claim. You’re paying for the convenience of not having to deal with the issue on your own. However, if we see you have a long history of filing claims, your insurance may increase in cost. This is because insuring you may mean taking on more risk. The good thing is if your business does not have a history of filing claims then you’ll likely have a lower cost.
How To Get A Product Liability Quote
You can submit a quote for product liability insurance here on our website. The process is entirely online and can be completed in 10 minutes or less. After you submit a quote, a member of our team will contact you.

When filling out the application, we will ask you for the following information:

  • Businesses contact information
  • Details of the products and/or services you want covered
  • Total gross receipts from all products and/or services
  • Information for your manufacturer, distributor, or supplier
  • Preferred limits of liability
  • Claims history
Claim Examples

According to a litigation report by Lex Machina, product liability lawsuits in the U.S. federal court system have been steadily increasing since 2015. With the number of claims on the rise, being equipped with the right coverage is essential.

Example #1 - $161,000,000 Claim
After attempting to start a controlled fire, a Blitz gas can exploded in the hands of one Orgeon man. He suffered burns across 45% of his body, and is just one of over 50 people who filed lawsuits against the company. Walmart was named as a co-defendant on several of the cases as they were the biggest retailer of the cans. Had Blitz installed a 5 cent safety device, many of the injuries and deaths may have been avoided. The company ultimately had to pay an estimated $161 million in settlements, with Walmart contributing around $25 million of the amount. Blitz ended up filing for bankruptcy and closing manufacturing plants.
Example #2 - $850,000 Claim

For one young woman, A hair dryer purchased from Amazon almost cost her her home. An electrical failure in the product started a fire in her bedroom that quickly spread to the rest of the house. After suffering from smoke inhalation, property damage, and emotional damage, both Amazon and the manufacturer paid over $850,000 in reimbursements.

Whether you are a supplier or a retailer, you sell online or in-stores, product liability lawsuits can impact any part of the product chain. Are you prepared to spend the money, time, and resources to handle a claim on your own?

Insurance Canopy has helped hundreds of business owners like you navigate through product liability lawsuits and create a plan suited to individual needs. Talk with a qualified agent today to see how product liability insurance can fit into your risk management plan.

CanopyCares Scholarship

Insurance Canopy is thrilled to announce a new scholarship program for students across the nation. Our CanopyCares program will offer several $1,000-$4,000 scholarships towards a student’s tuition. Individuals that meet the following criteria may be selected:

  • First semester freshman with university acceptance
  • 3.0 or higher GPA in high school
  • Enrolled to be a full-time student (12 credit hour minimum)
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Product Liability Insurance
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Product Liability Insurance

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