Looking for Product Liability Insurance?
If you sell products rather than a service, then you might need a level of cover to protect you in case a customer becomes injured or has their property damaged by something you’ve sold or made.
If you’ve supplied a customer with a product that you’ve designed, repaired, produced or sold then you could be held accountable should something go wrong with it. Whether the customer ends up with an injury from a faulty kitchen cupboard door, or the product ends up causing damage in their home, you could end up having to pay compensation as well as associated legal costs.
When are you legally responsible?
Although it’s not a legal requirement to have product liability insurance, there are some scenarios which would classify you as legally responsible for the product – even if it’s something you’ve given away for free such as a promotional pen or sticker:
Working with suppliers
Having a product liability insurance policy is something that companies in your supply chain may require before they do business with you. Whether it’s manufacturers, retailers, distributors or suppliers, you may find that they want proof of policy documents.
So, even though it’s not legally mandatory, you may find that your business improves due to taking out this insurance – plus you’ll know you’re working with reputable companies too.
Think it’s a hobby not a business?
Even if you think of your business as a side hobby that brings in some money, such as crafts you sell or jewellery on sites like Etsy, it’s still classed as a business. It may not be how you get your main source of income, but you’d still be held liable in court if someone was injured or had property damaged from your products.
Products can only legally be sold if they’re safe for their intended use. By taking proactive steps to keep customers as safe as possible, might help lower product liability insurance premiums as well as ensuring fantastic customer experience:
Product Liability Insurance – Useful FAQs
Whether you’ve given a promotional gift or supplemented an order with an extra product, if someone is injured, they can still make a claim against you. There doesn’t have to be a monetary transaction.
Even if you haven’t sold the product in the first place, the customer could still make a claim against you if you have repaired the product and resupplied it to them. It can differ from case to case so it’s worth checking exclusions on your product liability insurance policy to make sure.