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Product Liability Insurance: Safeguarding Your Business
In today’s litigious society, Product Liability Insurance is an essential form of coverage for any business involved in manufacturing, distributing, or selling products.
This insurance can protect your company against legal liabilities and financial losses resulting from personal injury or property damage caused by your products, whether due to manufacturing defects, design flaws, inadequate warnings, or insufficient instructions.
Product liability insurance provides protection against financial losses and legal expenses arising from claims alleging that a product caused injury or property damage.
What Can Cause Product Liability Claims?
Product liability claims can arise from various issues, such as:
- Production flaws
- Design defects
- Manufacturing errors
- Defective instructions
- Failure to provide adequate warnings.
What Does Product Liability Insurance Cover?
Product liability insurance generally covers the manufacturer’s, importer’s, reseller’s, distributor’s, or retailer’s liability for:
- Personal injury
- Property damage
- It may reimburse the insured for legal costs for defending claims in courts, such as the Federal Court of Australia, Supreme Court of Victoria, County Court of Victoria, Magistrates’ Court of Victoria, or Victorian Civil and Administrative Tribunal in Melbourne, Victoria.
Who Needs Product Liability Insurance?
If your business imports, resells, repairs, repackages, manufactures, or distributes goods or products, you may be held liable for:
- Production flaws
- Design defects
- Manufacturing errors
- Inadequate warnings
- Defective instructions.
How Much Coverage Do You Need?
The amount of coverage required will vary depending on your business’s specific needs and risk profile. For example, businesses selling chemicals may require $20 Million or even $50 Million in coverage, while a home furnishings retailer in Melbourne may have lower risk and thus need less coverage. It’s important to consult with a professional adviser to determine the right level of coverage for your unique business needs.
Protect Your Business with Product Liability Insurance
Given the potential for significant court awards for personal injury and legal costs, product liability insurance is a must-have for businesses. It can help ensure that both financial costs and related reputational damage are managed effectively as part of a comprehensive risk management strategy.
Get Coverage Tailored to Your Business
Product liability insurance is crucial for businesses to help protect against potentially large court awards and legal expenses. It’s an integral part of any business’s risk management plan, providing a level of financial security and allowing you to focus on growing your business while meeting your obligations under the Australian Consumer Law and other relevant legislation.
Contact an Adroit Insurance Risk Adviser today to discuss how we can broker and tailor a product liability insurance policy to help safeguard your business.