Product Liability Insurance Policy
Comprehensive Product Liability Insurance Policy for Your Business
What's Industrial All Risk Insurance
When it comes to buying a product, people naturally jump to reading reviews before undertaking any other way of researching about the product. This is a good strategy as it helps narrow down to fewer choices. But, do you first zone in on the number of 5-star rating customers have given like most other people? This is also a wise way of shortlist. But, more importantly, read several reviews to see if the product had any bad effect, meaning there was any injury to the customer or damage to customer’s property due to its usage before buying it.
A business is an intrinsically precarious entity. As a manufacturer or trader, you can fall victim to complex and costly legal actions because it is likely that your product might cause damage to a third party. This insurance policy includes claims that the policyholder becomes legally liable to compensate to a third party because of bodily injury or damage to the property, caused by the use of products manufactured, and marketed and/ or supplied by the policyholder.
What is liability?
As far as small businesses, liability means that a firm is accountable for the damages to a third, according to law.
What is Product Liability?
Product Liability refers to a situation where a consumer purchases a product, and a defect in the product causes bodily injury or property damage to a third party. In such circumstances, the business owners are held accountable for the damage.
What Can Cause a Product Issue?
Design defect: this issue exists in a product even before the final product is made. It suggests that the product design is unsafe or defective.
Manufacturing defect: a manufacturing defect refers to the defects seen during the process of making, including wrongly assembled product or a product in which a part is missing.
Marketing defect: This has no relevance to the product manufacture. Instead, it refers to how it was marketed to the consumer. Some common marketing defects include incorrect labelling, incorrect safety warnings, and insufficient instructions are common marketing defects.
All small businesses that produce and market a product ought to possess have Product Liability Insurance, including:
- Bakeries & confectioneries
- Clothing stores
- Florists
- Restaurants & hotels
- Gift shops
- Wholesalers
- Specialty food stores
- Coffee shops
- Pet stores
- Print and copy shop
What does a Product Liability Insurance Policy cover?
This policy covers a range of expenses incurred due to a defective product that can pose a range of risks that can lead to liability. These risks include a fault in the product, a defect in packaging, or wrong user manual.
- Product liability insurance in India protects the insured against the liability arising out of third-party bodily injury or death resulting directly or indirectly due to product manufactured or supplied by the policyholder.
- This insurance also covers if the people got sick owing to toxic substances used in your product.
- It covers if the third party is injured due to product defect or packaging defect causing.
Key Exclusions
The Product Liability Insurance Policy does not include:
- Liability for product recall
- Product guarantee
- Pure financial loss, including loss of goodwill or loss of market
- Costs incurred for repairing, reconditioning or modifying the faulty component of the product.
How to get the best policy
Find a specialized industrial insurance policy provider
You must deal with specialists. Since specialized insurance companies that deal with Product Liability Insurance Policy can give you a comprehensive solution. You need to search for one skilled insurance service provider.
Run a comparison study
You can find several sites offering you information about the various insurance providers, their policies and reviews. By running a comparison study, you can easily find an insurance company that is right for your needs and requirements.
Seek professional help
It would be advisable to find professional help to understand the policy, because, at times, it can be too technical for you to understand, and a person who is expert in the insurance business can help you in spotting the right kind of policy for your business. The insurance expert can make you understand the legal terms associated with the policies.
Read the terms and conditions carefully
You should read the terms and conditions. For instance, you need to know about the social exclusions, the add-ons of the policy, and more. Hence, take out some time and read the terms and condition carefully before buying the insurance plan.
Never let the business be vulnerable to the unpredictability of nature and happenings. You can keep everything under control by availing the best Product Liability Insurance Policy for your business and act with a sense of urgency when things go wrong without prior notice. So, stay safe.