If you are a manufacturer, retailer or wholesaler, managing your exposure to product liability is an essential part of your plan global risk management. Let's take a look at some of the issues underwriter liability arise when deciding whether or not to provide liability insurance products.
- How potentially harmful is the product? If only a component, which is the final product? The parts used in aircraft and medical equipment are closely examined.
- The applicant is a manufacturer retailer or wholesaler product? From the perspective of an insurer, the manufacturer will usually have the highest risk of prosecution and products wholesaler least.
- How many years of experience The applicant has in the company? Underwriters like to see a history of good experience of loss. A new high exposure parts manufacturer could have coverage in time trouble getting.
- What the applicant quality control program ? This includes the evaluation of how the product is tested, inspections, record keeping, instructions for use, handling complaints, and examination of the application.
- Is the applicant handling all different products in the past?
- is that the new applicant plan products in the future
- What is the extent of the applicant's market : local, regional, national, or international?
The last point regarding the contract brings an important consideration for companies that have an international clientele. The shape of the coverage of standard products requires that any damage occurring outside the United States, Puerto Rico, or Canada and resulting from the insured's product is covered only if the suit is filed within the States States, Puerto Rico, or Canada. Thus, it may be prudent for those who sell products outside these areas for foreign liability coverage policy. Similarly, insurers often treat distributors of products manufactured overseas manufacturers from a subscription and pricing point of view, because it can be determined that the action against the manufacturer or the foreign supplier is unlikely or that the manufacturer / supplier has no insurance product liability.
manufacturers should also assess their exposure to the withdrawal of the product. Whoever reads Consumer Reports magazine probably noticed its regular list of defective products which are removed. Many carriers offer coverage for expenses incurred by the insured for the withdrawal of their product.
Finally, all business owners with a major exhibition of products should seriously consider purchasing an umbrella policy. This will provide additional protection from disaster great costumes products that could jeopardize the viability of your operation.
Are you comfortable with the exhibition of products for managing your company's responsibility? If you have concerns, please contact your agent for further risk management ideas.
The covers here are described in the most general terms, and subject to the conditions and actual policy exclusions. For the actual wording cover, conditions and exclusions, see the policy or contact your agent.
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