Who Needs Product Liability Insurance?
Many California businesses may need product liability insurance in
addition to basic liability coverage. Businesses that sell any type of food are
particularly susceptible to liability risks. Manufacturers and sellers of
products that contain metal, plastic, wood, rubber, leather or textile are
likely to need product liability coverage. Any product with moving parts that
could crush, cut or pinch someone may need the additional liability coverage as
well. Your agent may be your best source of advice for evaluating your business
and determining if you need a product liability policy.
Businesses that may face product liability issues include the
manufacturer of a product, as well as manufacturers of components of a product,
and the assembling manufacturer. Wholesalers and retail business owners may be
affected by product liability too. A product liability policy typically
provides financial protection in the event a product causes bodily injury,
illness or other damage to a person or property.
Even if the accusation against you and your product is false or
inaccurate, you may still be sued and may face extensive legal costs to defend
yourself and your business. Product liability insurance typically includes
coverage for legal fees as well as damages in case you lose the lawsuit. It is
important to understand the limits in your product liability policy. You may
want to make sure you obtain a policy with the level of limits you need to
financially protect your California business.