How much does it cost to purchase a product liability insurance policy? What processes are involved? This article explains in detail how to purchase product liability insurance. …
Every manufacturer dreams of having a successful product on the market; a product that people actually buy and use because product development takes a lot of time and effort, and when the product finally hits the market and you start to smile at the pot, you couldn’t be happier.
But there is something that can hinder that happiness, something that can consume all of those profits and bankrupt your business if you don’t take care of it properly. This monster is known as the product liability claim.
When you make a product, you will likely be doing a lot of quality control and risk assessment to make sure your products are safe to use, but that’s not enough; because you can never tell what might happen to your customers as a result of consuming or using your products, so you should protect your business by purchasing a product liability insurance policy so that your business is covered, whether or not such cases occur. …
Now, product liability insurance is unlike any other insurance product on the market that you already know and even buy with your eyes closed; You need to be very careful when purchasing a product liability insurance policy, especially if you are new.
The steps below will help you understand how to purchase product liability insurance for your business and help you avoid mistakes when purchasing insurance -:
1) talk to a professional … It may be difficult for you to independently assess the risks associated with using your products and it can lead to your products being over-insured or under-insured, so it is always advisable to speak to a professional experienced in risk assessment and insurance. Such a person will be able to give you professional advice on how to insure your business against product liability claims.
2. Get as many product liability insurance quotes as possible: don’t rush at this point. You need to do your due diligence by typing in as many quotes as possible and comparing each one. Make sure you provide the relevant information to the insurance broker so that you can get the right quotes. Some of the information you may need to provide includes:
- The type of business and industry you work in
- Where do you run your business and manufacture your products
- Where and how do you sell your products? If your goods are exported, you must also indicate this
- List of suppliers and subcontractors
- Any other important information
3, compare quotes … When comparing quotes obtained for product liability insurance, resist the temptation to settle for the cheapest; the cheapest coverage may not be the best for your business. Rather, you should perform a thorough assessment of each quote you receive, taking into account the following factors:
and. Time factor -: the insurance policy treats time differently. Some policies cover you on a claim basis, while others cover you at the time of the event. Now let me walk you through each base.
The accident policy will cover you regardless of when the incident happened as long as the insurance policy is in full force. For example, if you purchased product liability insurance in 2099 and canceled it in 2005, if a customer filed a claim in 2014 for an event that occurred in 2004, the insurance company is required to pay the claims. claims even though the insurance contract has been terminated.
The claims policy is slightly different in that the insurance company will only cover claims that were filed during the period of coverage. It is very important to note this before choosing a product liability insurance policy.
b. You should also examine the quotes for spaces and matches. … You must be able to determine if the insurance policy is sufficient to cover all possible risks or if certain risks are not included. You should also look for additional coverage.
vs. Policy restrictions -: … How well each insurance policy covers you in the event of a product liability claim ?
4. Investigate insurance companies: it is not enough to just evaluate quotes and choose a company. Before accepting a business; You need to do proper research with the company to make sure you’re in good hands. You must first examine the financial strength of the insurance company.
- A financially weak insurance company will always look for ways to avoid paying claims … You want to work with a company that you can be sure will meet its obligations without stressing yourself out, and the first step in doing this is to determine the financial strength of the company.
- Next, you should look for reviews and testimonials from your customers. … You can easily use Internet search engines to find out or ask questions of other business owners. Too many dissatisfied and dissatisfied customers can indicate that this is not the right company for you to do business with.
- You may want to try your customer service skills to see how they respond to inquiries and complaints … You can do this by calling their customer service representatives and talking to them. The way they answer your questions can say a lot about how the company treats their customers and can also help you gather a lot more information about your insurance policy. that you are going to buy.