We often get calls from prospects wanting to buy Product Recall Insurance, A short discussion reveals most are actually looking for Product Warranty Insurance.
It is important to understand that the trigger for Product Recall Insurance is the potential for the product to cause bodily injury or property damage and be considered unsafe. Such products must be removed from the market. Product Warranty Insurance is much more passive. It involves a promise to repair, replace or refund the purchase price of a product that fails to meet a particular standard of performance.
Large retailers are frequently asking manufacturers, distributors and wholesalers to warranty their products in case they fail to perform to a reasonable standard and the retailer is forced to them back.
Most manufacturers or importers contacting me are looking for an inexpensive way to protect their profits when a warranty or indemnity agreement with the distributor forces them to take back a product. To the best of my knowledge, there are no insurance carriers willing to provide this type of insurance coverage. Most warranty insurance coverages are extended warranties for the repair of automobiles and equipment such as electronics, washing machines, etc.
Product Warranty Insurance benefits only the end user. For example, when you buy a car or washing machine, you can purchase an extended warranty insurance to cover repair or replacement costs. This insurance is a money maker for the retail establishment and the insurance carriers providing such coverage.Posted By: Paul L. Owens
3014 Devine St.
P.O. Box 5866
Columbia, SC 29250
1-800-622-7370 Toll Free