Product liability insurance is a kind of business insurance that can cover the cost of compensation claims if someone is injured or their property is damaged by a product that you have sold. In specific situations, you may be responsible even if you have not actually created the product.
What is covered by product liability insurance?
Product liability insurance can pay the legal costs and compensation fees if someone sues you for damage or injury. You are more likely to be responsible if the products bear the name of your business or if you have renovated or repaired them. You may also be responsible if the manufacturer can’t be traced, has gone out of business, or is not in the country.
If your product damages or injures someone, the main liability lies with the manufacturer. However, even if you don’t manufacture the products you sell, there are still a few situations in which you could be held liable.
Compensation payments can also take into account things like lost income due to damage or injury, or replacement or repair of goods in the case of property damage, so they can be very high. Product liability insurance can cover these costs so that your business is not ruined if you face a compensation claim.
How much insurance do you need?
It is totally up to you to decide how much cover you require. It is simply because the business provides product liability insurance as a part of public liability cover which covers you from compensation claims for damage or injury caused by your business.
When you are deciding how much product liability insurance your business requires, you should also think about the potential size of a compensation claim if someone was injured or their property was damaged by your products.
It is a great idea to check your client’s contracts to see if a specific level of public or product liability insurance is expected. Also, remember that compensation claims can be high as they can take into account replacement or repair costs if the property gets damaged, and lost income and medical costs if someone has been damaged. We offer product liability insurance as part of public liability insurance so you are covered against claims of harm caused by either your business or the products you sell.
Is it important to get product liability insurance?
Product liability insurance quotes is not legally required in the UK. however, you may find that suppliers, manufacturers, retailers, or distributors you work with will need you to have it. On top of that, if you are found responsible for damage or injury, or even death caused by one of your products, you can be liable. By the laws in the UK, products that you sell should be safe for consumers to use. However, no matter what precautions you take, sometimes things can go wrong.
Even though product liability is not necessary under the laws in the UK. The amount you can be sued for will depend on the severity of the accident and it is necessary to note that there is no upper limit to the potential payout.
Product liability insurance covers you against both potential compensation costs and legal fees.
Who is responsible for damage caused by a defective product?
Under the law, manufacturers, suppliers, sellers, and retailers could be liable for injury, damage, or even death caused by their product’s component parts. But, the party held responsible will lie on the specifics of each individual case.
