Products Liability Insurance

When you think of your product, do you think of all the implications that can arise from its use? Or do you focus solely on getting the product in the hands of the consumer and advertising to keep your brand name in the minds of the public? Most companies think of all these things and more.

They have come to realize that they are just as vulnerable to mishaps like property damage and injury arising from the use of their products as anything else. That is why companies focus on protection by obtaining product liability insurance.

The manufacturers or sellers of goods can be protected by Noble Insurance against any compensation or damages, which they may be called upon to pay as a result of accidental bodily injury or property damage caused by defective products.

This cover can be granted as an extension to Third Party Liability Insurance to protect against legal liability to Third Parties for property damage and/or death/personal injury arising out of defects in the products sold, supplied or manufactured by the Insured.

Product liability is the area of law in which manufacturers, distributors, suppliers, retailers, and others who make products available to the public are held responsible for the injuries those products cause.

Products Liability distinguishes between three major types of product liability claims:
  1. manufacturing defect,
  2. design defect,
  3. a failure to warn (also known as marketing defects).

However, in most states, these are not legal claims in and of themselves, but are pleaded in terms of the theories mentioned above. For example, a plaintiff might plead negligent failure to warn or strict liability for defective design.

  1. Manufacturing defects are those that occur in the manufacturing process and usually involve poor-quality materials or shoddy workmanship.
  2. Design defects occur where the product design is inherently dangerous or useless (and hence defective) no matter how carefully manufactured; this may be demonstrated either by showing that the product fails to satisfy ordinary consumer expectations as to what constitutes a safe product, or that the risks of the product outweigh its benefits.
  3. Failure-to-warn defects arise in products that carry inherent nonobvious dangers which could be mitigated through adequate warnings to the user, and these dangers are present regardless of how well the product is manufactured and designed for its intended purpose.

Product liability is a protection against financial loss arising out of the legal liability incurred by an insured because of injury or damage resulting from the use of a covered product or out of the liability incurred by a contractor after a job is completed.

Product liability insurance protects companies in the event that the products they have manufactured injure someone or cause property damage. In the case of lawsuits, product liability insurance protects a business financially due to claims or product defects. If you manufacture products to sell to the public it is a good idea to get product liability insurance so you can avoid unpleasant situations like a lawsuit that could possibly put you into bankruptcy or cause you to go out of business.

Product liability insurance policies go a long way in giving you the security you need as a business to produce products that are useful and valuable to your customers. However, you need to be aware of the implications arising from producing your products once they get into the hands of the consumers that will purchase them.

NOBLE Insurance Broker, Dubai – UAE can study the need of product liability insurance for your products and arrange for the suitable Product Liability Cover for you.