Manufacturing Insurance FAQ: What You Need to Know to Stay Protected

What are the most common risks that manufacturers face?

The manufacturing world is fast paced and extremely complex, making the smallest mistake or disruption costly. Here are some of the most common threats to a manufacturing business:

1. Supply Chain Disruptions: Manufacturing companies depend on the flow of materials and effective distribution to keep production on time. Delays can happen due to supplier shortages, severe weather, transportation problems, and global issues (COVID-19). This can lead to downtime in production and a loss of revenue. Business interruption coverage may help with these losses.
2. Property Loss or Damage: Things like fire, theft, natural disasters, and vandalism cab impact operations and your property. Property insurance will help protect your physical assets.
3. Equipment Breakdowns: Manufacturing machinery is costly and when it breaks down it can cause major disruption. Equipment breakdown coverage helps cover the cost to repair or replace equipment that fails due to mechanical or electrical issues.
4. Product Defects or Recalls: Defects in your products can lead to recalls, damaged reputation, and even legal expenses. Product withdrawal expense coverage helps to cover recall costs. Product liability insurance helps cover legal fees and claims related to product failures that result in bodily or property damage.
5. Regulatory Violations: Avoid penalties, fines, and shutdowns by complying with industry regulations.
6. Workplace injuries: Workers compensation insurance helps to cover medical expenses and lost wages when an employee is injured while performing their job.
7. Cybersecurity Threats: AI, robotics, and connected devices are on the rise, making cybersecurity threats even more prevalent. Cybersecurity insurance protects against data breaches, ransomware, and other cyber threats.
8. Transportation Issues: Whether products are shipped locally or across the country, there is always a risk of transportation issues. Severe weather, theft, and vandalism are the most common. Inland marine insurance provides financial protection for covered losses while your products are in transit over land or stored off-site.

What types of insurance do manufactures need?

A well-rounded policy should include:

1. Commercial Auto Insurance
2. Property Insurance
3. General Liability Insurance
4. Equipment Breakdown Coverage
5. Workers’ Compensation Insurance
6. Cyber Insurance
7. Inland Marine Insurance
8. Business Interruption
9. Product Liability Insurance
10. Crime Insurance
11. Commercial Umbrella Insurance 

What is the difference between General Liability Insurance and Product Liability Insurance?

General liability insurance covers the risks that are related to your business operations, whereas product liability insurance covers claims related to the product that you made and sold.

Widener Insurance Agency is here to serve and protect you! Call us and we can answer all of your questions pertaining to your business insurance needs!