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manufacturer's insurance

3 Areas of Liability in Manufacturing

3 Areas of Liability in Manufacturing

If you operate a manufacturing facility, you probably carry a manufacturer’s insurance policy. However, if you are careful, your policy may have exclusions or gaps that don’t cover some of the biggest areas of liability your company might face. One of these crucial areas is product liability. The group at https://www.dsayles.com cautions that financial costs associated with resolving claims concerning product liabilities are only a part of the challenges for a company. Trying to repair your company’s reputation can be costly, and it can take years to return to good standing in the industry.

The liabilities with a company product can occur at any stage of development, making it crucial for the company to continually demonstrate a commitment to safety. There are three primary areas of product liability facing manufacturing companies.

  1. Design Defects. When the products are in the design phase, a hazard analysis should be conducted to determine the potential areas where an end-user could be harmed or the property itself could be damaged. This should include both anticipated and unanticipated uses.
  2. Manufacturing Defects. If a product has been found to have a defective condition that creates or created a danger to the user, the manufacturer can be held liable. Quality assurance programs can help catch these areas.
  3. Warning and Instruction Defects. Hazards that can’t be avoided by design may be cautioned against through warnings. The adequacy of the warning to protect a consumer can be the cause of a liability concern, with inadequate warning potentially leading to end-user harm.