“Making A Case For Product Liability Insurance”
It seems that over the past four to five years, we have seen an incredible amount of new products being brought to market from some of the brightest entrepreneurs this country has to offer. It seems like each day a new product is brought to market that a year ago wasn’t even imagined. It does make one wonder what incredible new products we will be able to enjoy and in some cases can’t live without in the next five to ten years.
Whether your company is a retailer, distributor or a manufacturer of Baby and Children’s Products, Dietary Products, Cosmetic and Beauty Products, Food and Snack Products, Dog and Cat Treats/Food, Clothing Manufacturer, Craft Beer, Wine and Liquor, Consumer Products, Sporting Goods Manufacturer, Bikes and Tykes, or one of the endless number of unique products that come to market each and every day somewhere in the world, one action that every company must take is to acquire the proper amount of Product Liability Insurance Coverage. Regardless of whether your product is one that has the potential of being in the high risk category or your product comes with what a carrier would consider a low risk factor, acquiring Product Liability Insurance around California should always be an integral part of your business plan.
In working with clients over the past few years regarding their Product Liability Insurance needs, quite a few clients and potential clients question why they really need Product Liability Insurance and usually the main reason for this way of thinking is they are convinced that their particular product would never cause harm to a customer and couldn’t even imagine a lawsuit would ever be brought again their company, the way things are these days, that is hardly the case.
In the past few years, our agency has seen quite an uptick in production writing new and renewal Product Liability Insurance policies. Just when you think, what possible product is there left to invent and bring to market that could bring value to peoples everyday lives, along comes a new crop of the most usual and ingenious products invented by some of the most talented entrepreneurs in the country. It makes you wonder what incredible products are yet to be invented. With all the advances regarding internet search engines these days, there has never been a better time to market a new product.
Regardless of what stage your product is in, if a customer or client believes that the product they purchased from your company did them harm, they will file suit against all companies that in even the smallest way that had anything to do with the product. Lawsuits of any kind can be a very expensive endeavor, attorney fees alone can run into the hundreds of thousands of dollars, and the time involved you will need to spend on this kind of lawsuit can severely harm your company in the long run and quite possibly mean the company may have to shut its doors for good.
Acquiring a Product Liability Insurance policy around California can be one of the wisest moves you can make for your company’s long-term success. When discussing this particular type of legal concept, it is also known as a stream of commerce and it governs product liability in most of the states.
What this means is that any business that has some type of involvement in placing a product into the commercial stream may be held liable for a defect, therefore potentially exposing the company to the risk of having to pay damages for the defect in the product. If the claimant were to have the claim be successful, they could be punitive and compensatory damages, and also their attorney costs and any medical expenses they incurred may be added to the settlement.
In general claims of these types center on these central three issues:
Manufacturing/Production Flaws: With these types of claims, they will more likely involve a product that is found defective as a result a company’s production process, which in turn now make the product unsafe for a customer/client to use.
Design Defects: When the discussion turns to this type of claim, most of the time it refers to how a product was designed in the first place. One example of this type of claim would be that of a car maker.
Defective Warnings/Instructions: Look at any of the various products you have around your home, now read the warnings that the manufacturer has placed on these products. In quite a few cases you will asking yourself why on earth we would need this kind of warning, it’s just common sense and most people should know this. The reason they have these warnings is from the various legal risks that could potentially happen from the customer who has purchased the product. With products liability claims on the rise, companies are now putting much more detailed warnings on their products to reduce the risk of a lawsuit.
In most cases, businesses will take as much precaution as possible regarding their products, taking all the appropriate steps, but as we all know, things do happen from time to time, a consumer could be harmed by your product and your business could be held liable, which is why it is very important for your company to have the proper Product Liability Insurance Coverage. With Product Liability Insurance coverage, the insurance carrier has a duty to defend your business in the event of a covered claim, to cover the costs to investigate the claim and pay out any settlement or judgement that may be made against your company up to the limits of the insured’s policy.
There are no standard rates for Product Liability Insurance Coverage, mainly due to the fact that all these products are manufactured in so many different forms. As you know, the lower the risk, the lower the premium and the products that are deemed a high risk will carry a higher premium. If your business is developing a product, distributing a product or simply selling a product, PJO Insurance Brokerage has various insurance carriers to suit your product liability needs.
9850 S Maryland Parkway Suite A-5-262
Las Vegas, NV 89183
Office: 702-370-4799 / 877-234-5759