If your business provides products to your customers, it is essential that you have Product Liability Insurance to protect you against claims of personal injury and/or property damage caused by products that you supply.
Product liability insurance coverage goes hand in hand with Public Liability Insurance which is why 99% of Liability policies are organised on a Combined basis, in that both Public & Products Liability are provided automatically.
However, what does Product Liability protect you against? It protects you in the event a third party alleges injury or damage to their property caused by the provision of the product you sell, distribute, wholesale or import; the scenarios can be limitless from the common allegations of illness caused by food or beverages sold at the café all the way to toxic chemicals contained in a product.
One common scenario not understood by the general public is that if you import product directly into Australia from overseas, you are deemed to be the manufacturer of that product and as a result the premium levied by insurers will be significantly higher than a wholesaler distributing the same product after obtaining the product from an Australian based importer.
The cost of Product liability insurance depends on factors including where the product is sourced from, the type of product, your annual turnover, do you export? A couple of important points to note is that Products Liability DOES NOT provide guarantee of performance nor does it cover the costs of recalling faulty or damaged product.
As mentioned earlier, product liability automatically comes with public liability insurance policies in most cases. In a minimal number of scenarios, Products Liability may be available as stand-alone cover.