Product Liability - Honor Insurance

Product Liability Insurance

Essential Protection for Your Business

Product liability insurance is a type of corporate insurance that can cover the cost of compensation claims if someone is injured, or their property is damaged by a product that you’ve sold to them.

In certain situations, you may be liable even if you haven’t actually manufactured the product. legal battles can go far beyond between consumer and the company that supplied them; a ripple effect throughout the entire supply chain can make proceedings lengthy, complex and extremely costly.

Is Product Liability Insurance Necessary?

If you’re making, selling or distributing things, Product Liability insurance is a wise choice.

Whether a claim is legitimate or baseless, it can lead to significant financial implications. Even if a claim lacks merit, it must be treated seriously, as it poses a potential threat to your company's reputation and brand value. Having the assurance of coverage provides your team with the freedom to innovate and the confidence to engage in sales.

Who Requires Product Liability Insurance?

For those involved in selling products to customers or clients, or managing a supply chain, possessing product liability insurance is advantageous. This coverage is beneficial for various industries, encompassing :
- Manufacturers
- Retailers
- Wholesale and distribution businesses
Issues arising at any production stage may result in defects, posing a potential risk for a product liability claim against your business. Therefore, safeguarding your business with the appropriate insurance is crucial.

What Does Product Liability Insurance Cover?

Product Liability insurance applies in the following situations

Design defects: If there is defect in the design itself, that existed before the product was made.

Manufacturing defects: When there are manufacturing defects or flaws in the production process, leading to an unsafe product.

Strict liability: If a customer gets hurt by a manufacturers’ product, even if the business owner isn’t found negligent.

Improper warning: If there are no warnings or insufficient warnings on the product regarding its proper use and the associated risks when used or handled without adequate care.