Product liability insurance is important to any business’s risk management strategy. It helps protect businesses from the costs associated with product-related claims or lawsuits brought by customers, vendors, or other parties for bodily injury and property damage caused by a defective product. However, it is important to understand that not all risks are covered under this type of policy; there are certain exclusions that may limit your coverage and can be difficult to navigate.
​
Exclusions typically center around three areas: manufacturing defects, design defects, and failure to warn consumers about potential hazards related to their products. Manufacturing defect exclusion typically bars coverage for any damages arising out of a manufacturing process gone wrong such as assembly errors or component failures due to intentionally poor-quality control practices at the factory level. Design defect exclusion limits coverage when harm results from flaws in the layout or structure of a product that was known at its conception but failed because it was inadequately designed with inadequate safety features built into it prior to its release onto the marketplace.

Lastly, failure-to-warn exclusion excludes coverage if manufacturers fail to adequately warn consumers about potential risks associated with their products before they purchase them.

What are Some of the Common Exclusions of Product Liability Insurance
In addition to the exclusions outlined above, product liability insurance policies typically contain additional exclusions that can limit coverage. These include foreign component parts exclusion which excludes any claims related to a defect in parts of a product sourced from outside the country; consequential damages exclusion, which bars coverage for any indirect losses such as lost profits or reputation resulting from a defective product; and professional service exclusion which limits coverage for products used in certain professions such as medical practice or engineering.

Another common exclusion that can be found in many product liability insurance policies is the intentional misrepresentation exclusion. This clause excludes coverage for any claims or damages resulting from a manufacturer’s deliberate attempt to deceive buyers about their product through false advertising, labeling, or other means.

The illegal acts or violations exclusion typically bars coverage if a company is accused of violating laws governing the design and manufacture of its products. This could include anything from not meeting safety standards set by regulatory agencies to distributing counterfeit products in violation of intellectual property laws.

When selecting an appropriate policy, it is important to understand all the exclusions that may be included so you know exactly what risks are covered under your policy. It is also important to remember that while many of these exclusions are standard across most policies, some insurers may offer more comprehensive coverages with fewer exclusions than others. Finally, make sure you read and understand all terms and conditions before signing up for any type of policy – this way, you don’t end up paying out-of-pocket costs if something were to go wrong down the line.

Conclusion
In conclusion, product liability insurance is an essential element of any business’s risk management strategy. It helps protect businesses from costly claims or lawsuits brought by customers, vendors, or other parties for bodily injury and property damage caused by a defective product. It is important to understand the various exclusions that can be included in most policies, so you know exactly what risks are covered under your policy. When selecting an appropriate policy, it is also important to remember that while many of these standard exclusions are common across most policies.

Introduction
Product liability insurance is a type of insurance coverage that provides protection to businesses in case they are held responsible for any damages caused by their products. It covers property damage, bodily injury, and other losses resulting from the use of a product. This type of coverage is important because it helps protect businesses financially if they are ever sued due to an issue with one of their products. Companies can purchase this coverage at different levels depending on how much risk their business faces and the number of financial assets that need protecting in case there's a lawsuit. Without this type of insurance, businesses could be exposed to extreme financial loss if something were to happen as a result of one or more products they sell.

Types of Product Liability Insurance
​
Manufacturers Liability Insurance is a type of product liability insurance that covers businesses for any damages or losses resulting from the products they manufacture. This coverage helps protect companies financially if their product causes an accident, injury, or property damage. It also may cover legal costs associated with defending against lawsuits and other claims related to the product. This policy can be tailored to meet the specific needs of each business depending on what types of coverage are needed and how much risk they face in terms of potential liabilities.

Retailers' Liability Insurance provides protection for retailers who sell various types of goods. This type of insurance covers them if someone is injured by a product they have sold, as well as providing financial assistance with any legal expenses incurred due to a lawsuit regarding their products. Retailers should make sure this coverage meets all relevant laws in order to ensure full protection in case something goes wrong with one of their products down the line.

Wholesalers Liability Insurance is another form of product liability insurance that protects wholesalers from financial loss caused by faulty or damaged merchandise being sold through their business channels. It offers financial assistance if these issues lead to costly legal action such as lawsuits and settlements, helping cover both defense costs and awards given out for successful cases brought against them due to negligence involving a particular product being sold through their channels. Wholesalers can tailor this policy according to the level of risk faced when it comes to selling certain kinds of goods so that appropriate coverage can be provided at all times.

Benefits of Having Product Liability Insurance
Having product liability insurance is an important part of protecting a business from financial loss due to damages caused by its products. This type of coverage can provide protection against property damage and bodily injuries that may result from the use or misuse of a product. It also helps cover legal defense costs in case of a lawsuit as well as any awards given out should the company be found liable for any harm done by their product. Additionally, this coverage helps manage risks associated with new product launches and other related activities, which can lead to unexpected financial losses if something goes wrong. By having this form of insurance in place, businesses are able to reduce the risk posed by launching new products while still being financially protected against potential liabilities resulting from defective merchandise or careless manufacturing practices.

Important Terms of Product Liability Insurance
Indemnification Clause: This clause is an important part of any product liability insurance policy, and it states that the insurer agrees to pay for all damages or losses caused by a product. It also specifies which parties are responsible for paying out claims in case of a lawsuit. If a company wants to ensure maximum protection against potential liabilities, it should look into including this clause in its policy as it provides additional coverage if needed.

Exclusions From Coverage: Along with outlining what types of incidents are covered within the policy, there may also be exclusions from coverage listed, which means those particular events would not be eligible for reimbursement from the insurer even though they were caused by one of your products. By reading through these exclusions closely, businesses can better evaluate whether certain risks posed by selling their products can potentially leave them exposed in terms of financial loss down the line without proper insurance protection being put into place beforehand.

Conclusion
Product liability insurance is a key component for any business that manufactures, wholesales, or retails products. It provides financial protection in the event of an accident or injury caused by one of its products and can help cover legal costs associated with defending against any claims brought against them due to negligence involving their product. Having this type of coverage in place helps businesses reduce their risk exposure while still ensuring they have adequate protection should something go wrong down the line.

Strive Insurance Group, Inc. (formerly Gordon Lund Insurance Agency, Inc) is an independent insurance agency representing many insurance companies.  This means that we quote with many different insurance companies to obtain the best rate and coverage for your insurance.  We do this at no additional fee or service charge to you.  Our insurance agency's reputation for representing the best insurance companies, providing excellent customer service and competitive pricing to our clients has been earned and proven for over 30 years.  We take great pride in finding you the best coverage and backing it up with prompt personal service.

We recommend asking your agent a series of questions to better understand what your insurance covers and does not cover. 

• Do I need a personal umbrella? What does it cover?  What limit should I have?
• I drive for a ride-share company. How am I covered?
• What is replacement cost coverage, and why is it important?
• What happens if I rent a car and go both domestically and abroad? What coverage would my insurance have? 
• My homeowners' deductible, what is it? How would it be waived? When did I most recently file a homeowners claim? 
• What would happen if my house was destroyed completely? Could I instead use the cash value of my policy?
• My house is old. Would my insurance pay to rebuild my house to current building codes, or would I be responsible for that cost?
• I have a wine collection; how is that covered?
• I just constructed an outdoor kitchen, is this automatically covered? If not, what do I need to do?
• Can I receive any credits for combining my home and auto insurance together? 
• What is flood insurance exactly? Or an earthquake occurrence? Does my insurance cover these incidents? If not, should I add coverage?
• I employ a housekeeper.  What if they had a work-related injury?
• Am I potentially liable for their lost wages and rehabilitation? What if I'm sued by my employee?
• What if I misplace my jewelry? 
• I serve on boards for both for-profit and not-for-profit organizations. Will a claim made against me be covered by my own insurance?
• How much would my automobile be worth if it were a total loss? How, if at all, would the deductible apply?
• I recently started a home business. Does my homeowner's insurance provide any coverage?
• When should I include my kids in my auto insurance policy? When should they be removed?
• What happens if a sewer or drain inside my house backs up? I believe I am protected, but am I?

Give us a call today; we would be happy to help you better understand your insurance coverage. 
​
Strive Insurance Group, Inc. (formerly Gordon Lund Insurance Agency, Inc) is an independent insurance agency representing many insurance companies.  This means that we quote with many different insurance companies to obtain the best rate and coverage for your insurance.  We do this at no additional fee or service charge to you.  Our insurance agency's reputation for representing the best insurance companies, providing excellent customer service and competitive pricing to our clients has been earned and proven for over 30 years.  We take great pride in finding you the best coverage and backing it up with prompt personal service.