What is product liability insurance? 

For Texas businesses involved in the manufacture and sale of products, the risk of potential liabilities persists long after products are sold. If a product eventually causes serious injury, illness or property damage, the manufacturer and/or seller retailer may be held financially accountable. Product liability insurance may protect manufacturers and retailers from this sort of risk.

Product liability insurance offers specialized coverage for risks associated with products. Policies typically cover court fees, attorney fees and settlements if there’s a covered lawsuit.

Which Businesses in Texas should have product liability coverage?

Most businesses that handle products should consider the benefits of product liability coverage. This includes Texas businesses making, selling or transporting products. For example, all of the following businesses might want a product liability policy:

• Manufacturers and installers
• Wholesalers and distributors
• Online and traditional retailers
• Long-distance and local delivery companies
• Warehouses and storage facilities

Businesses that aren’t sure whether their product-related operations necessitate this coverage can speak with an insurance agent who’s familiar with product liability. A knowledgeable agent will be able to assess a business’s risk exposure, and then make a recommendation as to whether coverage would be useful.

What products can be covered by product liability policies? 

Product liability policies extend coverage to a wide range of products. No one policy is right for all products, but businesses shouldn’t have trouble finding policies for most products. Everything from dollar-store items and tourist trinkets, to electronics and furniture can usually be covered.

If there is any issue finding a policy for highly specialized or particularly hazardous products, a specialized product liability agent can check what options are available.

Should food service businesses get product liability policies? 

The foods and beverages that food service businesses serve to their customers can often be classified as products. 

Just as is true with other products, these could potentially cause serious illness or injury. Improperly prepared shellfish or meat can cause serious illness, while mistakes with ingredients can lead to bad allergic reactions.

To protect against risks like these, restaurants, food trucks, fast food places, bars, bakeries and other food service businesses might want to check what protections a product liability policy could afford.

Does general liability coverage protect against product-related risks?

Most general liability policies should not be relied upon for product liability protection. These policies don’t typically provide coverage for product-related risks, and the few that do tend to only give very minimal protection. General liability is more for common accidents and a couple of other risks that businesses face regardless of whether they have products.

For any product-related risks of note, a product liability policy is usually needed. This can often be bundled with a general liability policy, either as part of a business owners policy or commercial package policy.

How much do businesses pay for product liability coverage? 

Product liability premiums can vary, as they’re dependent upon numerous factors. The number of products, types of products, sales volume and method of selling all commonly influence cost.

The coverage is affordable in most cases, however, and almost certainly less than what a major injury or property damage claim could cost. Businesses can find out exactly how much a policy would be for them by comparing quotes with an independent insurance agent.