For many small businesses, getting the insurance coverage you need can be a frustrating and potentially expensive process.
Which of the myriad coverages apply to my business?
What does each type of coverage even cover?
What kind of limits will best meet my needs?
Am I paying too much for what my policy covers?
These are all common questions you may find yourself asking as you try to protect your business from liability.
In today's insurance marketplace, finding coverage that is both affordable and applicable can be dif
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Ask any kid what their three favorite holidays are, and in most cases the child is likely to include Halloween as one of them. And with good reason. They get to dress up and get lots (and sometimes lots and lots and lots) of candy. And it’s not just a holiday for kids. Many adults, too, get in on the fun to make Halloween one of the most exciting holidays of the year.
This time of year can also be a good time to remind those people or businesses you represent as an insurance agent to get product liability insurance. Many businesses, including those that manufacture, import, distribute, and sell halloween costumes, candy, and other products face unique exposures during this time of year. In some cases, these businesses make the majority (or sometimes all) of their revenue during the Halloween season and having all of that revenue wiped out because of an accident would be detr
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When you start looking at product liability claims they can fall within three categories: 1) Defective Manufacturing 2) Defective Design 3) Failure to provide adequate warning or instruction for proper use of the product.
Defective Manufacture
A defective manufactured product—a flaw during the process of making the product—can be the most obvious in a product liability claim. A factory may have an error while making the product which may alter the usefulness and cause injury to the user. Some examples of these claims include:
Cough syrup that is tainted with a poisonous substance
Bottle of soda explodes in hand of waitress causing several cuts and nerve damage
Agriculture product contaminated with pesticides or unsanitary standards and causes illness
Defective Design
Defective design differs fr
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You’ve probably noticed that updated policies from some insurance companies usually include tightened coverages concerning product liability insurance. There are new exclusions, more precise and specific verbiage, and more limited coverages. Essentially, some insurance policies are becoming more restrictive as the insurance companies become more specific in what risks they want to take. But not all insurance companies are taking this route.
Insurance Companies Track Data & Refine Policies
As claims and lawsuits test the coverage limits of a policy, insurance companies watch the case results to see what rulings will become precedent for future claims and lawsuits. When coverage verbiage comes into question during a claim, companies will monitor the decisions and outcomes so they can make necessary changes to avoid repeating the same verbiage conflict.
Co
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Let’s say a company makes a nutraceutical product, like a vitamin capsule, that helps people absorb nutrients from food more efficiently. On the product label, it specifically states that users should consult their physician before taking the product, and that sometimes an allergic reaction could occur. That should cover the business, right? I mean, it says right there that a risk of allergic reaction is present. Unfortunately, people don’t always read product warning labels and disclaimers, and not everyone heeds the warnings or realizes that they have a condition that will result in a negative reaction to the product.
So what happens if someone ends up in the hospital for severe digestive problems or an allergic reaction to the product? They could sue the company and demand paym
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