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General Liability Insurance for Manufacturing Businesses: A Detailed Overview

Apr, 14 2022

General Liability Insurance

General Liability Insurance for Manufacturing Businesses: A Detailed Overview

If you run a manufacturing business, general liability insurance can protect your business from common risks, including third-party property damage, bodily injury, and advertising injury. This policy will protect against costly lawsuits and help your business qualify for contracts and leases in certain instances. Here's detailed information on this topic.

What Does General Liability Insurance Cover?

General liability insurance protects your business's assets and income against everyday risks like third-party injuries at your premises. In case of an accident, your policy can cover medical expenses and the repair or replacement cost for the damaged property. Additionally, if you're sued due to an incident, your policy can cover your legal costs. General liability covers the following scenarios:

  • Customer property damage
  • Customer injuries
  • Product liability
  • Advertising injuries

If yours is a small manufacturing firm, you can bundle policies to increase security and save money. You can get a BOP (Business Owner's Policy) which blends commercial property insurance with general liability insurance. Getting a BOP is more affordable than buying each policy separately.

Your business may be eligible for BOPs if:

  • It has a small facility
  • It has less than 100 employees
  • Its annual revenue is not over $1million
  • It operates in an industry that's is considered low-risk

The Extent of Coverage Offered

  • Customer Injuries

    If a third party, say a delivery person or distributor, is injured in a slip and fall accident while on your premises, you may be held liable for the injury. If the injured individual chooses to sue you, you may be forced to pay their medical expenses, in addition to your legal expenses. If you're responsible for a third party's injuries, your general liability insurance will cover the following:

    1. Lawyer's fees
    2. Medical expenses
    3. Court-ordered settlements
    4. Funeral expenses in fatal incidents
  • Customer Property Damage

    If a third party's property is damaged due to an incident in your facility, your policy can cover replacement or repair costs. If someone sues you due to expensive damages, your general liability can cover your legal costs, court-ordered judgments, and other costs associated with the lawsuit.

  • Product Liability

    As businesses and people consume and interact with your products, there is a chance that your products may harm someone. Moreover, if your products are components of other products, say cars, you may be bought into lawsuits from the vehicle manufacturer as they figure out which party is to blame. General liability policies typically include product liability coverage for such risks. However, you should check if your policy comes with this coverage. It may be part of the products-completed operations coverage, covering liabilities related to faulty workmanship and defective products.

  • Advertising Injuries

    When running your advertising campaigns, you may mistakenly imitate your competitor's logo or slogan. General liability insurance covers the following accidental advertising injuries:

    1. Copyright infringement
    2. Defamation - slander (spoken) and libel (written)

For instance, if your competitor sues you because your campaign slogan is similar to theirs, your general liability policy can cover the legal expenses related to the lawsuit.

Some Other Important Policies to Consider

  • Workers' Compensation Insurance - This policy covers medical expenses and lost wages of employees suffering from work-related illnesses or injuries. In most states, you're legally required to carry this policy if you have employees.
  • Business Owner's Policy - It bundles commercial liability insurance with general liability insurance, and it's typically more affordable than purchasing the two policies separately.
  • Commercial Umbrella Insurance - This policy provides additional liability coverage on top of your primary liability policies, such as general liability, commercial auto insurance, or employer's liability.

For cost-effective general liability insurance that will adequately protect your manufacturing business, contact our experts at Riverbend Insurance today.