Does A Lessor Need a Product Liability Insurance Policy?

It might be unimaginable for a company who is in business for leasing out equipment to others to need insurance coverage for product liability. The company also buys the equipment that it generates income from. However, clients don’t see it that way. What they do understand is that a company who leases out equipment impliedly guarantees that the equipment they do lease out is fully functional and safe to use.

If an accident happens because the equipment overheated or malfunctioned, the lessee will likely claim for damages.

This scenario highlights the importance of a product liability insurance that covers the business activities of a lessor. Most, if not all lessors, lease out electronic equipment such as strobe lights, projectors, smoke and bubble machines and other paraphernalia that are often used to hold special events. These devices have the tendency to overheat, malfunction or explode, causing injuries to the users, and to bystanders as well.  It could be dangerous and may become an extravagant affair.

Due to the disaster the defective equipment could create an embarrassing or upsetting situation that arises from such an event, the lessor is likely to face a damaging lawsuit.

When this happens, a lessor who is protected with a product liability insurance need not worry. Proceeds of the insurance can pay for the claims stated in the lawsuit.

The cost that a business would likely focus on is repairing or replacing a damaged or worthless equipment. In this way, the cash flow that a business gets is spent on an asset that can further generate income rather than on expenses to maintain its existence.

The Importance of Making Sure You Have Product Liability Insurance Coverage

Do you sell products that could result in a claim against your company? If so any claim resulting from such a scenario would also be considered a claim under product liability. How will my business benefit from a products liability policy?

Well, the simple answer is that in the event of a claim you don’t have to worry about losing money.

Claims for bodily injury are notoriously unpredictable as are claims for damage to property. Look at the news and we see million dollar awards for such cases every day.

Furthermore, these claims often involve product lawsuits which can be both expensive and extremely stressful. It is much better to get the protection you need purchase getting an insurance policy than it is to deal with the consequences of not having a policy in place.

So, It is a very good idea for each and every business to have business product liability insurance. This not only protects themselves and their company, but it also provides protection for the consumers themselves. This type of insurance protects the business from all sides.

Mainly, it is liability insurance protection against claims that consumers make concerning their product.

This includes the manufacturing and selling of foods, medicines, and other goods made available to the public.

It will also cover both the manufacturer’s and seller’s liability for losses and injuries to a buyer, user, or bystander caused by defect or malfunction of the product. In some cases, it will even protect against inadequate information that is included in the warning that comes with the product. The three main types of claims that consumers can make of a product are as follows. Product flaw: the product, while in its making, ends up unsafe for the general public.

Design defect: Somebody claims that the actual idea and design is not safe enough to even be produced.

Defective warnings or instructions: this is when sufficient warnings of the product or instructions on how to use the product are not included. No matter what kind of claim that it is, such things can actually destroy a company. It really does not matter what kind of product the business is selling. Product liability insurance is a must at all times for all companies no matter what size they are.

Indemnity from Product Liability Coverage Could Just save Your Business

Whether it’s a small business producing handmade children’s toys or an international manufacturing conglomerate, any business, regardless of size or product manufactured, is at serious risk if it does not have product liability insurance.

If your business is involved in any way in the process of manufacturing a product – whether you are a supplier, the actual manufacturer, or a retailer, it is important that you obtain this insurance.

You may say to yourself – I’m a responsible businessman, I produce a safe product,

why would I waste money on this type of insurance?

The answer is simple: while you may be responsible, your consumer may not.

There are several ways in which a business can be subject to legal action or civil suits with regards to its products.
  • The product may be defective and cause harm to the customer. Even if the business had no knowledge of the defect it may still be held responsible.
  • A consumer may use the product in a way other than it is intended. Even though the consumer used the product in a way other than what the business intended they can still be held responsible if they did not expressly advise the customer through a label or warning in the instruction manual that the product is not to be used in that manner.
  • Even if the consumer has no actual standing to make a claim against your business – frivolous lawsuits are filed, and even if the business is not ultimately held responsible the legal fees incurred during the process can be crippling.

Depending on the size of your business and the amount you sell each year’s premiums cost to obtain products insurance coverage for liability security may vary. But insurance of any kind is a tradeoff – you may pay a high premium, but you may be saving yourself much more money (and even your business) in the long run by obtaining product liability insurance.

While some people know that product liability is about a business being held liable for injuries or property damage arising from the use of a product that is defective or not clearly labeled, many do not realize that it is not simply about the person who purchased the product having the right to sue the companies involved in the distribution of the product.

For this reason, it’s imperative that a business gets a policy that protects them from products liability insurance. Actually, any person who is harmed (or who suffers property damage) due to a defect in a product can get full disclosure about the companies involved in the distribution of the product.

That means that even passers-by who are simply at the wrong place at the wrong time can get the information they need to sue every single business involved in the distribution process of a product that caused the injury or damage.

Do You Really Need Product Liability Insurance?

When it comes to the products of a company or manufacturer, no one likes to hear the word “liability” because of the implications that are associated with it.

But “liability” is one of the few terms that are most common in the business market.

Often, the business person has to bear charges due to the damage inflicted by their products and in the absence of any appropriate product liability insurance, the company may suffer a great loss.

Such, unwanted circumstances make it necessary for the companies to have appropriate product liability insurance in order to sustain any liability charge against them.

  • However, who should go for product liability insurance policies?
  • Should sellers be more concerned about liability charges?
  • Alternatively, should those who lease out the products, worry about the liability issues?
  • On the other hand, the manufacturer has the most threat from liability problems?

    Well, to be honest, all of them must take appropriate precautions in order to avoid any liability lawsuit against them! To sum this up, every distributor must have the protection of product liability insurance.

There are companies, which exercise ignorance and carelessness when it comes to tackling the liability issues and these companies usually, ignore the cautionary measures! Thereby, they run a high risk of suffering a great loss due to product liability lawsuits. So, if you are one of the distributors in the present-day market, then, you must take caution to avoid any damage through liability charges.

Do not take risks and act before the damage is done!

While being in business, there are all sorts of scenarios that could transpire making a small business very vulnerable to being involved in a lawsuit. Although almost never intentional, products can become defective during the manufacturing process, be overlooked, and find themselves in the hands of the end consumer. This, in turn, can potentially lead to the injury or harm to someone leaving the company responsible for the producing the product liable.

That is why it is so important for businesses to fully protect themselves with product liability insurance for small business.

Liabilities can range from causing personal injury and/or property damage due to the product being defective or flawed, to neglecting to give proper warnings on how to use the product correctly. Since there is so much exposure to being sued, it is extremely important that companies have product liability insurance to cover their bases should an incident happen.

This type of liability insurance coverage can help in protecting the business from being dragged into costly court cases, which can lead to monetary loss and destroy the reputation of the company. Although some general insurance plans may provide some coverage for these legal cases, they may not fully cover the business owner. Having specific insurance that completely protects the company is certainly a must.

A Look at Why a Product Insurance Policy Is Essential Coverage Today

In business, people have to face a lot of difficult situations and tackle them with utmost care. However, many business people are neglecting those situations as simple one and moves on with their proceedings.

This is not good as it could lead to some serious legal problems in the future.

Like this one thing which the business people not taking care properly is the lawsuit.

In every business they can face any kind of lawsuit for various reasons that include defects in product, injury because of using the product, false promotions, and even besmirch. To protect businesses, from this kind of lawsuits, it is necessary to apply for a product liability insurance quote for defective products which protects the business owners from any kind of lawsuits such as claims against injury, defective products and like this anything.

Some examples in which you could be sued if you don’t have this product liability insurance is, if anyone using your companies product and the product is defective which causes injury to the concerned person then he/she could sue you. In another case due to improper use of the product the person using the product may got injured for this also you could be sued.

All these lawsuits are possible to handle without any hassle if the business people have product liability insurance.

Hence it is advised to take product liability insurance for any kind of business without fail and it is considered to be one of the essential things.

This plan is appropriate for all industries where the need for paying damages on account of defective products may arise. There are some features of product liability insurance that cannot be overlooked, these are listed below:

  • The policy pays for costs that the insured is lawfully responsible to pay as a result of unintended death or injury, including damage to third party property due to any fault in the product manufactured.
  • Exports to other countries can be covered, and domestic sales are also of course covered.
  • Products manufactured by accredited manufacturers on their own trade name can also be covered under the same policy.

There are also some benefits involved, these include.

  1. Claims as a result of accidents during the policy period due to defects in the product can be covered by the insurer.
  2. It covers injury to third party and contamination liability on account of products covered.

The main reason behind this type of policy is simply to guard against liability. In case a product is sold, and it is found to be unsafe, the seller can avoid expensive consequences in case a customer is injured from it in some way.

It can also provide extra guarantees, in case someone finds the product defective, the company can avoid a potential lawsuit or charge of parody.

The company can help ensure that the product is safe and meets the consumers’ needs. If an occasion arises where the product doesn’t work, the seller will be able to cover the situation and make sure that it is repaired and works accurately.

Why You Can’t Afford Not to Have Liability Insurance for Products

Product Liability Insurance or product recall coverage is necessary for any product manufacturer, importer or product seller business that offers products to others. This is due to issues with product liability negligence, misrepresentation and even injuries or damages that are caused by the products sold and purchased.

No matter how confident you are in your products, you still have the need for liability insurance coverage to protect you from potential lawsuits.

The risk of a lawsuit is not always tied into how well the product is made. A consumer could simply misuse your product and harm themselves or their property, and legally sue your company.

Even if your product is not to blame you could lose everything you worked for if you are not protected by products liability coverage. As a small business owner, you can rest a little easier at night if you have insurance protection covering you.

The recent US recession might have tempted you to cut corners on side expenses, but coverage such as liability insurance on your products is one thing you can’t go without.

Here are some situations you could be sued into oblivion over if you’re not adequately insured: Forgetting to include a warning on a product or having inadequate warnings. And almost anything can be construed as ‘inadequate’ these days. It doesn’t have to be a product you made yourself, even – it can just be something you sold or distributed to sellers, or merely altered or improved for a fee.

Similarly, injury-causing products are a bane to any company. If it can possibly someone or something in any way, and that person is willing to sue you, you’ll have a tough time of it without insurance to pay them off. How many products do you know that is completely incapable of hurting anything or anyone? Don’t forget intangible ‘things’ like electronic information!

A company can also be held responsible for base design flaws in a product, and a design flaw can be a lot of different things. Since design inherently has to compromise the wants and needs of the user with the realities of physics and the finances available to manufacture it, it’s almost impossible for a design to be truly flawless.

So if your company has anything to do with any product… and it probably does… then

you’ll want product liability insurance to take care of all those nebulous hazardous situations that not only might but will probably arise.

It’s scarcely possible to function in today’s market without it, and you’ll be surprised at how quickly the benefits make up for the premium cost.

Why Product Liability Insurance Is So Important?

In an economy such as we have in front of us today, businesses have to be aware that any financial difficulty or unexpected expense could be their very downfall. There could never be a more appropriate time to consider business liability insurance and risks you might be facing.

Business liability can mean a lot of different things… and there are insurance products designed for a variety of different business liability risks. One such product is product liability insurance.

Any company who sells a product to the public must make sure that they are capable of meeting head-on any problems that might come from that.

Product liability insurance is intended to cover damages and legal expenses that arise from claims against you and your legal responsibility.

Even if you’re not a manufacturer… if you’re a supplier, for example, a purchaser, user, or even a bystander can sue you, the manufacturer and anyone else who they feel should have noticed a defect in the product. You would be responsible for any judgment against you, and most likely for legal claims also, and this is where product liability insurance comes in to cover those fees.

Business owners never want to see a lawsuit, and they certainly don’t intend to wind up paying a lot of money out in a product liability case. But not planning for the possibility can be the “end” for many businesses who sell products.

How to Cover Your Business Assets With Product Liability Insurance?

If you are involved in any way with the process of delivering a product to consumers, and you’re without product liability insurance coverage, you’re in a position about as risky as the parachutist who fails to ensure that he’s hooked up before jumping from a plane.

In most courts, anyone in the chain of delivery of a product, from manufacturer to retailer can potentially be held liable if a consumer is harmed by that product. Increasingly, the burden of proof in liability suits is on the plaintiff – and that, my friend, is you.

Payouts in liability cases include medical costs, court costs, and often, a hefty sum for emotional distress. While you’re adding the costs up, don’t forget what you have to pay your own lawyer.

If you’re a small business, losing one liability lawsuit can wipe you out.

Insurance premiums aren’t cheap, and you might question why you need to pay them. Think of this way – let’s say you look out this morning and it’s cloudy. It might rain, and you have to decide whether or not to carry an umbrella. If it doesn’t rain, you’re stuck with lugging an umbrella around all day. But, that’s a minor inconvenience compared to what happens if you’re caught in the rain with one.

Consider product liability insurance policies to cover your assets and to guard against the rain of a liability suit which could really soak you.

How to save Money on Liability Insurance for Your Business

Running a business can be one of the most rewarding things, but it can also be a very risky venture. By being a business owner, you open yourself up to a greater risk of claims against you for fault, even if you take extreme care to make sure you provide quality service and products.

Liability insurance for businesses is one way to protect your business from the expenses associated with lawsuits… but the price tag on policies can be high.

First, it’s important to determine the type of policy you need. There are general liability policies, which protect a wide variety of claims. There are professional liability policies, which protect a service-based business against claims of error, omission, or malpractice. And there are product liability insurance policies, which protect businesses against claims of injury or damage from a defect in a product you manufacture or sell.

Once you determine which type of policy suits your business most closely, it’s time to work on getting the best rates possible.

First, shop many different places. Try looking for online business liability insurance… many times, you can get a better price online than you can from a local insurance agency. Internet sites frequently can get quotes from many different carriers and give you free quotes. You never want to just get a single quote… make sure you get more than one before you make your decision.

Then, see if there is a local group you can join that would offer discounted insurance rates for members. An example might be the Chamber of Commerce in your city.

You can also see if you can bundle policies together that you need from a single company – sometimes you get a discount by purchasing more than one policy.

The last suggestion is to find a niche policy broker. Rather than looking for someone who sells liability insurance to all businesses, see if there is a provider catering specifically to your industry. They might know the intricacies of your business and find ways to save you money.

Who Needs a Defective Product Liability Insurance Policy?

Product liability insurance covers losses related to a product or injuries incurred by someone as the result of a defect or malfunction with the product.

The 3 main types of product liability insurance claims are for

flaws stemming from the manufacture of the product, design defects, or incomplete or incorrect instructions or warnings.

Contrary to what many people believe, it is not just the manufacturer of a product who can be liable for product safety claims related to that product.

Claims can also come because of problems with the product’s storage, transportation, or handling after it has left the manufacturing facility.

Whether you are a manufacturer, distributor, installer, or importer churning out thousands of products items routinely; the need for product liability insurance is a definitive aspect of doing business.

Product liability insurance is the blanket policy that protects your company against claims made against your firm for the products you make.

This can be a business-saving solution when a consumer has levied a claim against you for a defective or faulty product and you are potentially facing hefty lawsuit fees and settlements.

Product liability insurance is a required part of a business, no matter how large or how small your operations are.

Far too many companies who resell products, whether it be wholesale or retail, forget or don’t know that they should also have product liability insurance.  Don’t wait, get coverage today so you can know that your business is protected.

Why Product Liability Insurance Is Needed for Product Claim Defense

Product liability insurance is not mandatory but certainly beneficial if you are involved in any type of retail business that sells, supplies and delivers products to clients.

You and your business can be liable for a liability case that is just a claim even if the product you sell was manufactured by a third party.

Someone running a business should not be under the impression that because the business is only involved in distributing, product liability coverage is unnecessary. Even if your company’s name is not on the product you can end up in court.

Without a commercial product indemnity insurance policy, your business and possibly your home could be in jeopardy.

All product manufacturers, product distributors as well as suppliers and retailers of goods should get a product liability business insurance policy.

Does your business current sell products to the general public? If so there could be a design defect in your product that could cause you to have a liability that you don’t even know about yet.

This would mean that your company could have participated in placing the product into the public where others can purchase it and can be held liable for damages to the end user if something happened to someone due to design defects, manufacturing defects, and even defects in marketing.

If your company provides any products to the consuming public, then your company needs product liability insurance or completed-operations coverage.