Businesses that manufacture products for customers have a lot of responsibility. By manufacturing items that others depend on, they face a unique set of risks. Luckily, manufacturing insurance exists to help mitigate these risks. We break down the coverage, cost, and benefits of insurance for manufacturers below.
Who is manufacturing insurance for?
Manufacturing insurance is designed for businesses whose operations involve manufacturing a wide range of products. ALIGNED can help manufacturing businesses in all industries find quality commercial insurance. For example, some of the manufacturing businesses we can help include but are not limited to:
- Electrical equipment and wiring manufacturers
- Metal parts and components
- Food and beverage manufacturers
- Mineral and metal manufacturing
- Plastic and rubber manufacturing manufacturing
- Wood products and furniture manufacturing
- Beauty cosmetic product manufacturers
- Chemical manufacturing
- Automotive assemply and parts manufacturing
- Clothing and textile product manufacturers
Recommended insurance coverage needs for manufacturers
If you’re wondering what manufacturing insurance covers, you’ve come to the right place. Ultimately, commercial insurance policies for manufacturing companies vary but typically include similar key coverages including commercial property insurance, commercial general liability insurance (including product liability insurance) machinery breakdown insurance, crime/theft, and more. Keep reading to discover some of the recommended coverage types for manufacturers.
- Commercial general liability insurance: Commercial general liability insurance, sometimes referred to as “slip-and-fall insurance,” protects against the day-to-day risks that come with operating a manufacturing company. For example, if a distributor visits your building and slips and falls on a wet floor, they could sue you. With this type of coverage, you might be compensated in the event of a third party property damage or bodily injury claim. Specifically, your insurer may cover the cost of medical expenses, repair bills, legal fees, etc up to the policy limit.
- Product liability insurance: Under your commercial general liability insurance policy, you can add product liability insurance. Product liability insurance is especially important for manufacturing companies as it can protect you against claims of third party property damage or bodily injury stemming from a product you manufacture, distribute, or sell to a consumer. Damages covered by product liability insurance are specifically for physical damage incurred, but the source of problem could include a defect in the design, manufacturing, or marketing of a product, like an incorrect label, lack of safety warning etc.
- Commercial property insurance: Protect your physical manufacturing building, any machinery, all business-related contents from unforeseen circumstances like theft, vandalism, fire, water damage, etc with commercial property insurance. When you add commercial property coverage to your manufacturing insurance policy, your insurance provider may pay for repairs or replacements in the event of loss or damage caused by an insured peril.
- Cyber liability insurance: If your manufacturing business stores confidential information online, then cyber liability insurance is important. With cyber liability coverage, if a hacker breaches your system and steals important data, your insurance provider may help cover the associated costs, which could include credit monitoring, legal fees, crisis control, patient notification, and more.
- Business interruption insurance: Business interruption insurance can protect your manufacturing business from lost income if it is forced to close due to an insured peril. Insured perils covered by business interruption insurance vary but can include theft, fire, vandalism, windstorms, water damage, and more.
- Equipment breakdown insurance: If a piece of manufacturing equipment suffers an internal failure due specific perils like electrical arching, pressure vessel explosion etc. equipment breakdown insurance could help cover the cost of repairing or replacing it. Even better, business income lost as a result of the equipment breakdown may also be covered by the insurance company.
- Commercial auto insurance: If your manufacturing uses vehicles for business purposes, such as to transport materials, equipment, or products, you may benefit from commercial auto insurance coverage. Policies vary but may include third party liability coverage, uninsured automobile coverage, accident benefits coverage, etc.
- Crime insurance: Crime insurance can help mitigate the financial losses of employees to your manufacturing business, such as employee dishonesty, fraud, burglary, robbery, theft, etc.
Does my manufacturing business need insurance?
Though it might not be mandatory, purchasing commercial insurance for your manufacturing business comes with many benefits and is typically contractually required. Namely, this type of coverage can safeguard your business against day-to-day risks like property damage caused by fire, theft, or lawsuits alleging bodily injury, damage, negligence, and much more. Without this type of insurance, you would be left to pick up the pieces of an unforeseen incident all by yourself. Not only can this be stressful but it can have a serious financial toll that could lead to long-term problems for your business.
If I buy product liability insurance, will it cover me for products sold to other countries?
It’s important to check the specific terms, conditions, and exclusions on your policy. However, in many cases, product liability coverage extends to products that are exported to another country. That said, you may need to increase your coverage limit as the financial consequences of an unforeseen event can be greater for products shipped internationally as some jurisdictions are more litigous than others. Do not hesitate to contact a friendly and knowledgeable insurance broker at ALIGNED for more information on how commercial insurance can protect your internationally-exported products.
What factors affect the cost of insurance for manufacturers?
Many factors affect the cost of insurance for manufacturers. Insurance companies use many details to determine risk and calculate insurance premiums. For example, an insurance provider is likely to consider everything from the size and location of your manufacturing business to the number of employees at your business and the types of products you manufacture. This is why the cost of insurance for one manufacturing business likely won’t be the same as another. Some of the key factors affecting the cost of insurance for manufacturers are as follows:
- The location and size of your manufacturing business
- The industry your manufacturing business is a part of and the types of products you manufacture
- Your insurance claims history
- Your years of experience
- Your policy coverages, limits, and deductibles
- The number of employees who work for your manufacturing business
- The annual and projected revenue of your manufacturing business
Ultimately, the best way to find out how much manufacturing insurance will cost you is to contact ALIGNED. We can explain in further detail which factors matter most to insurance companies, provide you with a free quote, and even offer some expert tips on how to save money on manufacturing insurance. All ALIGNED quotes are accurate, competitive, and 100% obligation-free.
Please note that insurance companies are responsible for setting premiums, not brokers. So while ALIGNED can help you find a great policy, we do not determine rates. Get in touch to learn more about the advantages of working with a broker.
3 reasons to purchase manufacturing insurance from an insurance broker at ALIGNED
Debating between buying manufacturing insurance through a company or a broker? Consider the following three reasons to buy insurance for your manufacturers with an ALIGNED broker:
- ALIGNED brokers are industry experts: ALIGNED insurance brokers are fully licensed and know the ins and outs of the insurance industry. We will use our resources and expertise to find you a great policy.
- ALIGNED brokers operate independently of insurance providers: ALIGNED brokers work independently of insurance providers, which allows us to put our customers’ needs first. We always aim to offer unbiased, objective advice to help each customer find the best policy for their needs.
- ALIGNED brokers take care of everything: The last reason to purchase manufacturing insurance with an ALIGNED broker is that we do all the heavy lifting. We take the stress out of shopping for insurance by doing it for you. From the moment you contact us, you will be assigned a dedicated broker who will guide you through the entire process. They will contact insurance companies on your behalf, obtain quotes, compare policies, unlock discounts, and finally, present you with multiple options.
ALIGN your manufacturing business with top-notch commercial insurance
ALIGN your manufacturing business with comprehensive coverage by working with ALIGNED. Our team of friendly insurance advisors is fully licensed and eager to help you find the right policy for your manufacturing business. We take the time to understand your unique circumstances and will always put your business’s needs first. So if you’re ready to take the plunge and purchase insurance for your manufacturing business, call ALIGNED today or click here for a free quote.
