Product liability insurance protect your company against claims or lawsuits related to injury or property damage arising from defective products produced, distributed, or sold by a company.
In the case of a product recall, product liability insurance pays out the costs associated with a customer’s lawsuit against you. It does not cover any of the costs of recalling your product, removing your product from the market and rehabilitating your company’s reputation, which would be covered by product recall insurance.
Product recall insurance covers the financial losses that may arise from the costs of recall the products due to defects that may occur during production, distribution, labelling or packaging.
Most common claims are caused due to: