Coverage 101 | How to get product liability insurance Canada
Are you a manufacturer? Or perhaps a wholesaler? Likely this is why you landed on this page. We understand that products liability insurance coverage is an important part of your overall business insurance program. That’s why Canadian businesses in the manufacturing, wholesale, distributing and/or retailing industries of any/all products need liability insurance.
Typically, products liability insurance coverage can be found as part of a commercial general liability insurance policy. It is important to note that CGL insurance policies are also typically modular products.
This means that your specific liability coverage is usually found in the section that’s often labelled as “Products Completed Operations Insurance.”
If you are looking to get more information about product liability insurance Canada, this post can provide you with some helpful insights. Keep reading to learn more about not only why product liability insurance Canada is so important, but how it can specifically help your business.
Product liability insurance – a brief explainer
There are many reasons why product liability insurance Canada is on your mind. First and foremost, products liability coverage provides financial protection for your business.
As you are likely aware, there are numerous activities from the manufacturing or sale of products, foods, medicines or other items that put your business at risk. And it is precisely these exposures are that product liability insurance Canada products are designed to respond to.
In other words, as part of a Commercial General Liability policy, this coverage provides protection against lawsuits for losses due to injuries caused by your products. This includes design defects or a failure to warn consumers about the dangers of using a product, etc.
Real Claims Scenarios | Here’s how product liability insurance Canada coverage helps
Here are three examples of common situations that products liability insurance coverage is designed to respond to:
- Manufacturing or production process flaws that cause unreasonably unsafe defects in the product. For instance, there may be traces of dangerous chemicals, ingredients and/or contaminants in your product, which could be toxic to those using it.
- Design defects that make the product unsafe for use by the public.
- Failure to provide adequate defect warnings or instructions for using the product. When products are not properly labelled or have warnings that are not sufficiently explanatory to reduce consumer risks while using the product is typically when these claims arise.
Depending on the details of the case, money may be awarded to the party that filed the claim for their damage (including medical costs, economic damages and attorney’s fees) or punitive damages.
Regardless of the outcome, your business will incur significant legal expenses defending a product liability claims.
This is why it is good to know that defence costs will also be covered by your product liability insurance coverage.
Who specifically needs products liability insurance in Canada?
Even if you do not physically manufacture, repackage and/or alter a product in any way, you may be at risk for litigation.
The actual manufacturer is not the only party liable for product flaws, defects and failures; retailers and wholesalers can also be found negligent and/or liable.
The logic here is that there is a stream of commerce that a product goes through from its inception to the hands of the consumer.
If your organization had any part in that stream, and as long as the product was defective when it left your control, you can be held liable for any problems that arise.
Product liability in depth | Some Canadian industries at risk
Providing relevant insights is just one of the ways we deliver a different experience to our clients across the country. Below, please find excerpts from two recent blog posts that we’ve created about specific product liability risks.
Baby product liability insurance in Canada
Your company has made its commitments to health and safety, and you work to produce quality products. Nevertheless, no business owner can oversee every product that comes down the line. Whether you manufacture your products in Canada or overseas, you are liable for accidents or injuries.
Even if your company is not directly responsible for this defect, you may still be liable based on the chain of sale. If you have baby product liability insurance in Canada, your insurance company will help pay for legal costs associated with a lawsuit.ALIGNED Insurance: What to know about baby product liability insurance
Pet product liability insurance in Canada
When it comes to pet food, it’s important to foster customer confidence in manufactured foods. Whole foods are becoming more popular. The dog food industry must rely on product safety in order to avoid fostering the trend of frozen meat for a dog’s primary food source.
Of course it’s not just foods that are under scrutiny. Pet medications, toys and comfort products also need pet product liability insurance. Whether your products are manufactured in Canada or overseas, your company may be liable for any defects or failed product warnings. Keep reading about pet product liability insurance.ALIGNED Insurance: Understanding pet product liability insurance Canada
We are here to help you get the best product liability insurance Canada
Risk happens when you least expect it. This is why if you are in the manufacturing, wholesale, distributing and/or retailing industries of any/all products, you need product liability insurance that will deliver.
Across Canada, ALIGNED Insurance brokers know the product liability insurance marketplace. We work with more than 65 of the top insurance companies in Canada to get you access to the best options for your business. Let us help you find the best value and options for product liability insurance.