Get indemnity™ product liability
Unfortunately, mistakes and accidents occur with even the most well-designed products. Therefore, it’s important that you hold sufficient liability insurance to protect your business.
We operate in a compensation culture with the public generally more aware of their rights. With the no win, no fee system making legal advice more accessible with no upfront costs. Liability claims, even if they are without merit, are becoming more frequent.
At get indemnity™ product liability insurance quotes start from £224 annually or £18.66 monthly. Below we provide some background about the cover and explain how the insurance can offer protection to your business.
Who needs product liability insurance cover?
Any business who supplies products is responsible for their safety and should therefore consider liability insurance to protect their financial interests.
Manufacture or product distribution
The level of responsibility and potential liability will depend on whether you are involved in the manufacture of the products, or whether you are involved with the distribution.
If you're involved in the manufacturer, you hold the ultimate liability for the safety of the product you produce.
However, the below identifies circumstances where you can still be wholly responsible from injury or property damage as a result of a fault with a product:
> If you repair or repurpose a product.
> Materials are imported from outside the European Union (UK post-Brexit)
> If you commission the manufacture of a product.
> If your business name or trademark appears on the product.
> Materials are from a supplier who is no longer in business or is unidentifiable.
> The supplier has a hold harmless agreement that indemnifies their liability.
Compare insurance quotes with get indemnity
™ by arranging a call back
to discuss your needs and ensure you are fully protected wherever you sit in the supply chain from compensation claims.
How do insurers calculate your product liability insurance cost?
To calculate your product liability insurance cost, insurers will consider the type of products being produced, where the materials are being sourced and where you are sending finished goods.
Exporting to the USA or Canada
Products sent to the USA or Canada can increase your liability cost due to the size of the compensation awarded provided by the courts.
Products produced in Asia
Materials or products produced in Asia and other countries can restrict your ability to hold the supplier to account and increase your insurance cost.
Safety critical goods
Safety critical goods such as toys, electrical goods, machinery, fireworks, food and medicines carry an increased risk should they fail when being used.
Perishable goods such as food or medication can easily be destroyed in transit or be ineffective once sold if not stored correctly.
Should we combine our liability insurances under one product?
Liability insurance that will protect against claims as a result of a fault with a product you have provided, can be combined with public liability insurance
and employers' liability insurance
In many instances you will not be able to seperate liability insurances because of the way the policy wordings are designed. It is common for businesses to combine their covers under commercial combined business insurance.
Compare insurance quotes with get indemnity™ by completing our digital onboarding process and ensure you are fully protected from demands for compensation wherever you sit in the supply chain.
Product liability insurance definitions
Product liability insurance definitions and exclusions can vary, therefore it's worth working with an expert insurance broker
to ensure the cover best meets your needs.
Laws governing the distribution of products in the UK
Liabilities for products is governed by legislation and regulation. Products sold to consumers and commercial customers under The General Product Safety Regulations 2005 are required to be 'safe'.
The steady rise in counterfeit and illegal products makes distributing products increasingly complex. The UK government offers guidance on Product Liability and Safety Law and Product Safety for Manufacturers.
Many consumer protection laws rely on 'strict liability', where it does not matter if the person accused did not intend to break the law. To use this defence they must satisfactorily prove all reasonable precautions were taken to avoid an offence being committed.
Failing to meet your responsibilities can have serious consequences. Potential claims arising from anyone injured or who has suffered damage to property. Ensure your business is protected with get indemnity™ product liability insurance.
Managing your liability risk from product claims
The best time to build in sufficient safeguards to guard against potential liability claims is in production and development. Consideration should also be made to the following risk management controls:
Transfer of legal liabilities
Can assist your business reduce product liabilities caused or contributed by others. 1) Hold harmless agreements help ensure your suppliers are contractually responsible for their own negligence. 2) Evidence from suppliers they have sufficient insurance in place.
Management of imported goods
Businesses that import products, components and raw materials may be held responsible for safety requirements. Importers should gather and retain information to ensure imported products comply with the applicable standards and regulations to guard against liability claims.
Keep essential records on file
Copies of customer design specifications, product orders, including customer agreement. Written procedures that describe the flow of the product through the manufacturing process and quality control. All of which will provide evidence if liability allegations arise. When designing products, a safety review should consider how a product will be used and the potential hazards. They should comply with all safety standards, which include labels, warnings and instructions.
Product liability and consumer safety
You must ensure a level of care has been taken to keep the consumer safe. The below offers several measures that can help manage your liability risk:
- Provide product information to help consumers understand the risks.
- Provide sufficient warnings of potential risks and dangers of improper use.
- Effectively monitor and report on the safety of all products.
- Take early remedial action should product safety concerns be identified.
- Retailers should take reasonable steps to ensure the safety of the products sold and identify the sources.
- A formal product risk management system will provide value in supporting a defence against product liability insurance claims arising from injury or property damage as a result of a fault with a product you have provided.
How much product liability insurance should you buy?
The amount of liability insurance you purchase will depend upon your activities, products, perception of the exposure and how much you are prepared to spend to mitigate the risk.
The type of products you produce will likely impact your decision. For example, if you are a clothing manufacturer, the risk of injury or damage to property is far less than if you are a fireworks manufacturer.
Maintaining sufficient knowledge about the legal landscape, your responsibilities and how to manage your risk is an important consideration, in addition to purchasing insurance.
Minimum amount of product liability insurance
The minimum cover typically offered is a £1 million limit. However, the potential cost of personal injury claims can be significant, therefore many businesses will typically purchase a minimum of £5 million or £10 million.
Goods / product liability and insurance considerations
A safe product offers either 1) no product liability risk; or 2) a minimum acceptable level of product liability risk, taking into account reasonably foreseeable use of the product and the need to maintain a high level of protection.
As a product producer (i.e. importer, manufacturer, own-branded, re-conditioner) you are responsible for ensuring your products are safe and carry adequate instructions and warnings. In addition you will need to undertake a 'conformity assessment', which shows the product to be safe (i.e manufacturing standards or third-party assessment). You are required to have measures in place to identify any risks arising from a product's use and to ensure the necessary corrective action can be taken (i.e. product recall).
As a product distributor you must not supply goods you believe could be dangerous. Legislation requires you to monitor the safety of the products you supply and advise the producer if any problems arise.
Obtain your liability insurance quotes by calling 0345 625 0711 to discuss your business requirements or arrange a call back at your convenience.
How to compare product liability insurance quotes?
Insurance quotes can be made available with 48 hours of completing our online application
. However, every manufacture, wholesaler or product distributor is different, therefore we may require additional information and time to secure a quote.
At get indemnity™ we continue to see stable market conditions for insurance cost, driven mainly by an abundance of insurer capacity. However, certain categories of products still remain challenging (i.e. products designed for children).
Additionally, if you export to the USA and/or Canada insurers will typically want to gain some further information about the products you provide and whether they meet the required safety standards.