Product Liability – Do you have the protection your business needs? As a business owner, you have worked hard to build your business – how can you be sure to protect what you’ve built? At Pinnacle Peak Insurance, we help business owners build insurance plans to cover their business – make sure you’re covered. 480-424-4756.

What is Product Liability?

Product Liability is protection that transfers the risk of defects, including expenses related to product lawsuits and other claims related to a faulty product.  

Who needs Product Liability?

Any business and/or persons that manufactures or sells a product, including but not limited to,  selling a product you did not manufacture, but resell this product with your company’s label.

Product liability is there to protect your business from claims related to the use of your product.

The Main Types of Product Liability Claims

There are many instances when a product can injure a person, but they all fall under 3 categories.  

The three main categories of product liability claims: 

  • Design Defect. For example: Your beautifully designed SUV has a design defect. Due to the way it was designed, it is top heavy and can flip easily if you take a corner too sharply and/or at a high rate of speed.  (As a side note, if your SUV did flip for this design defect and a bystander sustained injuries due to this defect, the bystander could bring suit against the manufacturer for their injuries as well. 
  • Manufacturing Defect (Most Common) Example: The recalled stroller/car seat due to excessive heat the plastic buckle that holds your child can possibly crack and fail during an impact.  This is now a manufacturing defect that depending upon injury could result in a product liability claim. 
  • Marketing Defect (Warning and/or Labeling) Example: It’s morning and you are in need of a pick-me-up and grab the latest in line of energy drinks.  As you walk into your first meeting of the day, you realize something is majorly wrong.  After a trip to the hospital, you realize the energy drink you consumed almost killed you.  You were allergic to an ingredient not listed on the label, but is in fact one of the ingredients of this drink.  This is a Marketing Defect.  

It is important to know all your coverages for your business, to ensure that all parties involved are covered.  Contact Pinnacle Peak Insurance today for more information