Possibly the most over-used comment by Product Liability prospects is “My product is safe.” It’s usually followed by something about getting a low insurance premium because the product is so safe.
Sadly, there is almost never any independent test data to back up these claims of safety. The products that are “so safe” are often being imported from a foreign manufacturer, leaving the prospect little or no way to control quality.
Those that do have independent test data to back up their claims are typically very well received by the Product Liability insurance underwriters. And they do receive better than average insurance premiums and rates.
So you’ve proven your product is safe. However, it is important to understand when you purchase insurance, you are participating in a product liability pool. This pool is made up of businesses that sell products similar to yours or in a similar product class. One or two Product Liability claims by any businesses in your pool can result in severe losses by your Product Liability insurance carrier.
You may resent the price insurance carriers require to protect your interests. But I strongly recommend that you visit www.recalls.gov. The number of recalls announced in just one month is shocking. Know that a recalled product could or did cause bodily injury or property damage. And each of those may lead to a very costly Product Liability lawsuit.
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