You need to buy product liability insurance if you want to protect your business against lawsuits and claims brought on by the products you make or sell.
A seller or manufacturer is liable for the property damage and bodily injury that a third party may suffer due to a malfunction or defect of their product. This third party refers to a user, buyer, or bystander.
Why Do You Need Product Liability?
If you own a business and supply products, manufactures, designs, or give them for free, you will want to get product liability insurance as well. While you are not legally required to have this kind of insurance, your business could be facing a lawsuit or claim due to a faulty product.
Your business could be legally accountable if
Product liability is a category that belongs to general liability insurance. Product liability is usually covered with another coverage, which is a liability for work completed. This combination is referred to as products-completed operations liability, which is under the bodily injury, coverage A, and property damage liability.
On the other hand, if your business manufactures potentially toxic products, including insecticides and pharmaceuticals, an insurance company may not qualify you to have product liability coverage. But with a business like this, you can buy this coverage from a specialty insurance company. Consult with a surplus lines broker to help you find an insurer for this kind of coverage.
Through an endorsement by a manufacturer liability insurance, you may be given vendors coverage if you are the product seller. It means that the seller becomes an added insured in the endorsement. As a seller, this coverage can protect you against a lawsuit caused by defective products from a manufacturer.
The state you reside in is also a factor if you will be held accountable for faulty products or not. Unless you alter the design of a product, the state may limit your liability as a product seller.
If you want to protect your business from claim or lawsuit due to your products, make sure to buy product liability insurance.
At Insurance Advisor Network, we aim to provide comprehensive insurance policies that make your life easier. We want to help you get the insurance that fits your needs. You can get more information about our products and services by calling our agency at (918) 528-6226. Get your free quote today by CLICKING HERE.