Products Liability Insurance Australia

Product liability insurance and public liability insurance both protect your business against allegations of negligence, but for slightly different types of claims.

From a practical perspective, business experts strongly recommend all small businesses to have both public and products liability insurance as their core covers.

For many small business occupations in Australia, insurance companies can combine product liability insurance with public liability insurance.

Whether combined or on standalone policies, the team of SMART business insurance brokers may be able assist by helping you find suitable product liability policies.

Product liability insurance may protect sole traders, contractors, and small businesses from claims of certain types of negligence in relation their products. For example, claims could arise if their product injured someone or damaged their property.

Here are examples of some of the business activities that can lead to product liability claims.

• Supplying food or drinks can cause illnesses such as food poisoning.
• Supplying clothing, appliances, equipment, tools, or furniture can cause an injury or damage property.
• Supplying mobile phone or computer hardware accessories that do not perform their function as could be reasonably expected, resulting in damage to the mobile phone or computer.

Whether your products are used properly or improperly, claims can arise. Almost any type of equipment or product you supply can lead to an injury or property damage.

Product liability insurance is a type of business insurance that can cover the cost of a claim made when one of customer or third party is injured or suffers illness or property damage caused by a product that you have sold to him.

It is an essential cover for any business that is involved in the production, supply or sale of products. No matter what type of product you sell, there is always the potential for something to go wrong.

Claims of personal injury, illness or property damage resulting from defective products may result in significant financial claims for compensation.

Even if you and your product are found not to be at fault, you may still incur considerable legal costs in defending a claim against you. In some cases, you could even be found liable for damages when you are not the manufacturer of the product.

While you are most likely to be subject to such claims for products that you manufacture, you may also be liable if you have repaired or refurbished a product you sell or if it bears your company name. You could also be found liable if the manufacturer of the product is no longer in business (or otherwise cannot be traced) or is located in another country.

Product liability insurance is designed to protect you from financial losses resulting from such claims; including payment of your legal expenses and compensation you are ordered to pay if you are found to be legally liable.

Product liability insurance is relatively inexpensive when you consider that for a modest monthly fee it may cover your business for several million dollars in damages. The exact cost of product liability insurance will depend on the size of your business and the types of products that you sell.

It could vary, for example, depending on whether your business manufactures products, resells or refurbishes other manufacturers’ products or only sells other manufacturers’ products.

A smart way to ensure that you are fully protected against any potential product liability claims for your business is to get a quote from one of our insurance brokers; after outlining the products you make or sell and your business activities.