What Is Product Liability, And Why Do I Need Insurance?
Most business owners were not aware that product liability insurance policies are a simple matter of protecting their business when claims arise due to defective products.
Imagine this… you give your daughter a shiny new bicycle and are teaching her how to ride it. You have the training wheels on, and she is excited to try it by herself, without your help.
So you let go of the bike, and off she goes… only to have one of the training wheels malfunction and you watch as she topples over unexpectedly.
Fortunately, your daughter probably will not be hurt significantly, but product malfunctions such as these happen frequently and sometimes can cause great damage to property or bodily injury.
When this type of damage or injury occurs, the user of the product, as well as anyone standing nearby who might have been injured, can sue the parties responsible for that damage or injury.
Typically, one would think that would be the manufacturer of the product; however, the entire chain of distribution of the product can be held responsible, from the manufacturer to the retailer.
The products liability insurance policy protects these businesses from financial ruin. These insurance policies allow them to pay legal expenses arising from claims related to product defects.
