Product Liability Insurance 

Products Liability Insurance covers the legal costs and compensation claims brought against your business for any injuries or property damage caused by a faulty product. If your business designs, manufactures or supplies products that is sold or given away to the general public then you have a responsibility to ensure that they are safe. Many products are regulated by health and safety and product safety laws so if you are manufacturing or supplying any products, it is vital that you ensure that you are complying with these laws. 

What is Product Liability Insurance? 

Products Liability Insurance protects businesses from claims relating to the manufacture, design and supply of products, food, medicines or any other goods to the public. It provides cover for bodily injury and property damage caused by their negligence. 

Do I Need Product Liability Insurance? 

If your business designs, manufactures or supplies products to the general public that is sold or given away for free then you can be held liable for faulty products even if you did not manufacture them. If any of the below apply to your business then you should consider taking out Products Liability: 
 
If your businesses name is on the product. 
If you import the product from outside the EU. 
If you cannot identify the products manufacturer or if they have gone out of business. 
If your business repairs, refurbishes or changes the product. 

What Does Product Liability Cover? 

Product Liability Insurance protects you against the legal costs and cost of compensation for injuries and damage to property caused by your faulty product. It may not cover you for faulty products resulting from poor workmanship or financial losses to a business or person caused by your faulty product. 
 
If you do not manufacture the product but supply it you should be covered if you can show that: 
 
The products were faulty when they were supplied to you. 
You have good quality control and systems in place for retaining records. 
You have records of providing adequate safety instructions and warnings of misuse. 
Your manufacturer covers product safety, quality control and returns. 
You included terms for the return of faulty goods to the manufacturer. 
 
You can choose a policy that covers you between £1 million and £5 million but usually products liability insurance comes as part of a business package policy. 

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