Product liability insurance policies shield businesses from claims related to the manufacture or sale of products to the public. Products may at times be lower in quality or standards, which may end up causing injury or death due to manufacturing defects, incorrect operation instructions, or consumer ignorance. The cost of covering these damages is quite expensive, since it involves legal fees, punitive damages, medical charges, and compensation costs. However, with product liability coverage, business owners can continue with the normal operation of their business without any disruptions or added costs.


Product liability laws hold every retailer responsible for any products they make or sell. This means that your business is held accountable for incidents that result in bodily injuries, death, or property loss due to the products that you sell. Product liability insurance provides you with coverage in case your business ends up being sued. This coverage generally covers the cost of medical expenses, legal expenses, and other expenses that your business is responsible for paying. It also gives your business some measure of protection in case the manufacturer of the products you sell is really to blame for producing faulty, defective, or unsafe products and shipping them to your store.


If your company manufactures or processes products for public consumption or operation, then your company requires product liability insurance coverage. This is because your products may lead to a number of potential product liability claims, such as:

Design Defect

A company is liable for products with designs that may turn out to be unsafe and cause damage to a person or property. For instance, a product might have sharp edges or be below the set limits on standards. 

Production Flaws

A company is liable for all claims that may arise from product flaws. These include manufacturing products with different specifications or no standards, and those that are contaminated. For example, a food manufacturer's product might accidentally contain pieces of metal or harmful bacteria.

Instruction Errors, Improper Labels, and Insufficient Warnings

Another way that your product may be found defective is through misuse by customers due to errors in the instructions, improper labels, or insufficient warnings that explain the risks. 

Operating your business without product liability insurance may expose your business to possible risks that may cause huge losses. With a product liability insurance premium, your business is protected from all these claims from third parties. 

Have more questions? For more information on product liability insurance and Round Rock Business Insurance, call Integrity Network Insurance Group at 512-989-6006

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