What Is Product Liability Insurance?

Typically, it gets included in a Commercial General Liability (CGL) insurance policy. Product liability insurance is the best security for your company in the event of losses resulting from personal injuries, property damages caused by malfunctions, or issues with your product.

If your company manufactures and sells products, you are responsible for the development.

The three most prevalent areas of risk to the product are:

1: Design

Suppose there’s something fundamentally wrong with the product’s design, which causes injuries or damages or injury. In that case, it could lead to you being held accountable.

2: Manufacturing

If the plan is good, but there was a lapse in the construction method, it could be liable.

3: Marketing

Suppose there’s no defect in the product’s design or manufacture. In that case, you may still be held responsible for the failure to contain enough warning labels or directions.

Who Needs Product Liability Insurance?

Anyone who runs a company with any product must carry liability insurance.

Some examples of who needs insurance for product liability:

1: Catering Businesses

The insurance for product liability can protect against an illness caused by beverages or food.

2: Retail Stores

Once you start selling items, you’re vulnerable to claims for product liability if a buyer gets injured due to using a product they purchased at your retail store.

3: Wholesaler

Even if you’re selling directly to consumers, you may be held accountable for product defects as the producer or distributor of a product.

Insurance for product liability can also protect businesses from risks, such as software developers and suppliers of material.

How to Drive Down Your Risk of Liability

We have always said that although insurance is an essential element of security for your business, the primary line of defense should be the prevention of loss.

Here are a few ways you can reduce the chances of having an insurance claim for product liability:

1: Develop Your Product

To minimize your risk, you need to know what these risks are.

Be sure to evaluate your product from beginning to end to determine any vulnerabilities resulting from the design, production, distribution, or marketing.

It’s also a good idea to do the same for any companies with your work.

2: Test Your Products

Quality control processes are essential to reduce the chance of harm from your product.

Make sure your products are tested frequently and thoroughly by outside sources. Your product is getting pushed by people who don’t have the same level of familiarity with the product as you do is significant. Trying the product yourself should also get conducted; however, you might be too close to the product.

Product testing should be an ongoing operation rather than a one-time occurrence to ensure no flaws in the manufacturing process. You’re up to date on all safety labeling concerns.

3: Maintain Detailed Records

It is essential to write and maintain records that describe how you go about your products’ production, design, and marketing.

It will not only assist you in discovering any new risks. However, it could be helpful in every case against you, as it will prove your attention to detail and focus on the safety of your product.

4: Alerts

Even if your manufacturing and design processes are flawless and your products. Get well tested, and it’s a good idea to include a general warning about the usage and consumption of your development. as a “catch-all” for things you can’t anticipate.

Suppose your product is made available to any person interested in buying it. In that case, you can never predict what possibilities could come up.

What Is Product Liability Cost Insurance?

Like most insurance policies for businesses, the price of Product Liability Insurance in Ottawa differs based on several variables.

  • The type of product
  • Its intended purpose
  • Revenue from sales
  • Where and how to get made

These are only a few criteria that determine the cost of your product liability insurance policy, so it’s ideal for getting a personalized quote for your liability insurance.

If you have any concerns about this or any other insurance element, contact Ottawa Commercial Insurance at (613) 454-5640 or info@commercialinsuranceottawa.com.