Insurance – A Safety Net for Your Business
As its name suggests, a manufacturing insurance policy is tailored to cover risks involving businesses that deal in the manufacture of products. The insurance policy may include coverage for warehousing and manufacture of unfinished goods and materials.
Manufacturing businesses face a variety of risks and exposures in the process of transformation of materials into new products. Thus being a manufacturing business, a manufacturing insurance policy is essential to protect your assets while they undergo transformation from raw materials to end products.
A manufacturing insurance policy will offer coverage for:
- Business interruption, which may be due to machinery failure or wear and tear of machinery. This could easily disrupt your business and cause loss of income, which may even lead to bankruptcy.
- Material damage, which may be due to fire damage, to machinery, buildings, stocks, contents, portable equipment. Manufacturing insurance policy covers your financial losses in case of building or stock damage.
- Products liability offers coverage for an injury or damage to somebody or their property arising from your negligence during business activities. The policy provides cover for any compensation payable to claimants and for legal fees.
Manufacturing insurance programs provide protection for any business that manufactures a product for public use and faces potential manufacturing liability suits. You should have a properly designed product liability insurance policy if you manufacture any of the following products:
- Food of all types
- Leather goods and textiles
- Plastic, metal, rubber and wood products
For businesses that manufacture or sell products, a well-designed manufacturing insurance is essential and pays for the damages if you lose in litigation and attorney fees to defend your business.