Products Liability Insurance

Products liability insurance is a type of insurance coverage that provides protection to businesses against financial losses resulting from the production, manufacturing, distribution, or sale of defective products. This insurance product is designed to cover a wide range of risks associated with product liability, including bodily injury, property damage, and personal injury caused by defective products.

Coverage Scope

Coverage for Injury or Damage: Products liability insurance covers claims arising from injuries or property damage caused by a defective product. This can include bodily injuries, illnesses, or property damage resulting from the use or consumption of the insured product.

Manufacturing Defects: It protects against claims related to defects in the design or manufacturing process of a product that render it unsafe for consumers.

Labeling and Packaging Errors: Coverage may extend to claims resulting from incorrect or inadequate product labeling, warnings, or instructions that lead to harm.

Failure to Warn: If a product has inherent risks that are not adequately communicated to consumers, products liability insurance can provide coverage for resulting claims.

Legal Defense: The policy typically covers the legal costs associated with defending against product liability claims, including attorney fees, court expenses, and settlements or judgments.


Risk Mitigation: Products liability insurance helps businesses manage the significant financial risks associated with potential product-related injuries or property damage, reducing the impact on their financial stability.

Legal Compliance: Having products liability insurance can demonstrate a commitment to responsible business practices and may be required by law or regulation in some industries.

Protection of Reputation: In the event of a product recall or liability claim, insurance can help protect a company's reputation by enabling swift and professional responses to address the issue.

Marketplace Expectations: Many clients, distributors, and retailers may require businesses to have products liability insurance before they will carry or sell their products, especially in industries with high product liability risks.

Koru Korner

Related Articles


IRMI: Contractor's Professional Liability—The Products Liability Exclusion

Each year, contractors face an increasingly diverse array of exposures and a growing list of options for managing those exposures. A common solution is the transfer of risk via a portfolio of insurance products—but coordinating the purchase of multiple insurance products is often complicated by the inconsistency in coverage terms between different insurers. This is especially true of professional liability policies.

Products Liability Insurance
General Business

ILS: Transforming from Competitor to Strategic Partner, Elevating the Reinsurance Sector to New Heights

Artemis Update: AM Best has upgraded its outlook on the global reinsurance sector from stable to positive for the first time in over a decade, highlighting robust profit margins and improved underwriting conditions. The rating agency now views insurance-linked securities (ILS) as strategic partners rather than competitors, emphasizing their role in supporting traditional reinsurers. Despite a deceleration in reinsurance pricing, AM Best notes that underwriting discipline and healthy profit margins are expected to be maintained.


May to Break Another Cat Bond Record: Biggest Month of Issuance Ever

Exciting news in the world of finance and risk management! May is set to break records as the biggest month of catastrophe bond issuance ever. According to a recent article from Artemis, the market is experiencing unprecedented growth, highlighting the increasing demand for innovative risk transfer solutions.


2023 Habitational State of the Market – Casualty

The habitational insurance market is facing a multitude of hurdles when it comes to casualty placements. Casualty markets in the habitational space have been adjusting prices due to increased loss activity and the continued impact of social inflation. Within this landscape, property owners, insurance companies, and brokers are confronted with a new reality. There are few markets offering General Liability (GL) coverage. It’s also difficult to find markets willing to participate in the lead $5M of excess coverage, making the marketplace even more challenging. To succeed in this demanding market, one must strike a careful balance between innovation, robust risk assessment, and adaptability.

Ready to partner with Koru?

Request a Risk Assessment today!