What is Product Liability?
It comes under the consumer protection act. Product industry is the largest industry that include businesses like food, medicines, clothes, technology and more. The businesses in these industries can easily be the victim of product liability risks.
All businesses are responsible for how their products affect customers. While products are meant to deliver good results, they can sometimes cause harm or even be dangerous. Defective products may injure people or damage property, which can lead to costly lawsuits against the business.
🤩 Key Coverages in Product Liability Insurance:
💡Bodily Injury Coverage~ Protect against claims if consumer gets injured by defective product.
💡Design Defects~ Claims related to product issues due to poor design.
💡Manufacturing Defects~ Claims related to the problems while creating or assembling the product. This can include toxic chemicals used or wrong materials.
💡Failure to Warn~ Inadequate instructions or warning about potential risks associated with the product use
🤔Who Needs Product Liability?
✔️Manufacturers- Especially those producing food, pharmaceuticals, medical devices, electronics or machinery.
✔️Distributors & Wholesalers- Selling a defective product make them them accountable as they are part of the supply chain.
✔️Importers & Exporters- Bringing products into a country makes them legally responsible for safety standards.
🤔Why It Matters?
👉Protects businesses from financial ruin due to lawsuits.
👉 Safeguard brand reputation by showing commitment to consumer safety.
👉 Provides peace of mind.
What is Public Liability?
It is a type of insurance that protects businesses against claims from third parties for bodily injury, property damage or death caused by their operations or premises.
It is designed to protect businesses from legal and financial consequences if their any activities harm to the public.
🤩 Key Coverages in Public Liability Insurance:
💡Third-Party Bodily Injury: Covers claims if someone is injured due to your business operations or premises.
💡Third-Party Property Damage: Pays for accidental damage to another person’s property caused by your business.
💡Legal Defense Costs: Covers attorney fees, court costs, and settlements related to liability claims.
💡Medical Expenses: Pays for medical treatment of injured third parties.
💡Compensation for Death or Disability: Provides financial protection if an incident leads to severe injury or death
🤔Who Needs Public Liability?
✔️Retailers & Shops: Foot traffic increases the risk of accidents.
✔️Manufacturers & Industrial Units: Especially those handling hazardous substances (mandatory under India’s Public Liability Insurance Act after the Bhopal Gas Tragedy).
✔️Contractors & Builders: Construction sites pose risks to workers and the public.
✔️Event Organizers: Large gatherings can lead to accidents or property damage.
✔️Hospitality Businesses (Hotels, Restaurants, Cafes): High customer interaction makes them vulnerable to claims.
✔️SMEs & Service Providers: Any business dealing with clients, visitors, or agents benefits from this protection
🤔Why It Matters?
- Shields businesses from unexpected financial shocks due to lawsuits.
- Helps maintain trust and reputation with customers and partners.
- In some industries (like hazardous materials), it is legally mandatory.