If you've created and marketed a product, you have every right to be proud of your accomplishments. To make sure you get to share it with the public for years to come, consider product liability insurance to protect your business. This coverage protects wholesalers, manufacturers and distributors from legal claims regarding products they sell or make. The definition of a product is broad and covers food, medicine, machines, and clothes sold to other people. Claimants include buyers, users or bystanders injured by the product. It can work in your benefit in almost any business.
What's Covered? 
Damages covered under product liability coverage are called compensatory damages, including loss of income, medical expenses, and pain and suffering. Punitive damages and attorney’s fees are typically included up to the coverage limit. So, to put it simply, if you harm someone else
Types of Product Liability Claims
Product liability coverage often falls under your general liability coverage, and covers the following issues.
- Manufacturing or Production Flaw
In these incidents, the person hurt claims the product has a hazardous defect due to the way it was made. For example, a customer buys an electric saw from the hardware store. The blade guard flies off the tool while she's using it.
The injured buyer hires a lawyer to sue you because one of your employees didn't install the guard correctly. The judge may determine that, due to the unreasonable danger posed by the saw, you have to pay punitive as well as compensatory damages. Without product liability insurance, you could be on-hook for thousands of dollars.
This type of claim purports that something went fundamentally wrong during the design phase. For example, our customer injured by the blade guard believes that the company failed to make sure their employees installed the guard correctly. Or, that the blade had a defect that people failed to note.
Forgotten defect warnings and instructions may also cause injuries. For example, packers may forget to include the instructions, or someone could forget to put on a required warning label. This leaves your business open to lawsuits if the oversight causes an accident. You failed to warn parties of the dangers posed to them.
A manufacturer or seller can also be held accountable under strict liability — liability without negligence. If you manufacture or sell products, your business can be sued if a buyer is harmed by the product. It may not mean that you meant to cause a problem, but it happened anyway.
Including product liability in your general liability insurance can protect you from unintended impacts of a defective product. Choose this coverage as recommended by your agent to make sure one unfortunate event doesn't put you out of business.