General Liability vs Product Liability: Understanding the Differences. General liability and product liability are two types of insurance coverage that businesses may need to protect themselves from financial losses resulting from lawsuits. While both types of insurance offer protection, they differ in terms of what they cover.
General Liability Insurance
General liability insurance provides coverage for claims arising from bodily injury, property damage, and advertising injury. It is designed to protect businesses from liability arising from their day-to-day operations, such as slip-and-fall accidents, damage to property caused by employees, and claims of defamation or false advertising.
Product Liability Insurance
On the other hand, product liability insurance is designed to protect businesses that manufacture or sell products from claims arising from injuries or damages caused by their products. This type of insurance covers claims resulting from defects in design, manufacturing, or labeling of a product, as well as failure to warn consumers of potential dangers associated with the product.
General Liability vs Product Liability: Understanding the Differences
One of the main differences between general liability and product liability is the type of risks they cover. General liability insurance covers a wide range of risks that a business may face, while product liability insurance is specific to risks related to products. General liability insurance can protect businesses from a variety of claims, while product liability insurance is limited to claims related to products.
Another difference between the two types of insurance is the types of damages that they cover. General liability insurance typically covers damages to third parties, including bodily injury, property damage, and advertising injury. Product liability insurance, on the other hand, covers damages related to a specific product, such as personal injury, property damage, or economic losses resulting from a product defect.
When it comes to the cost of insurance coverage, product liability insurance is generally more expensive than general liability insurance. This is because the risks associated with manufacturing and selling products are typically higher than the risks associated with day-to-day business operations. However, the cost of insurance coverage can vary depending on a number of factors, including the type of business, the industry, and the size of the business.
In conclusion, general liability and product liability insurance are two types of coverage that businesses may need to protect themselves from financial losses resulting from lawsuits. While both types of insurance offer protection, they differ in terms of the types of risks they cover, the types of damages they cover, and the cost of insurance coverage. Businesses should carefully consider their specific needs when choosing between general liability and product liability insurance to ensure they have adequate protection in place.
Think you are immune to a Product Liability Insurance Claim?
Everyone does! However, the product that was assumed to be the most harmless, that almost everyone used on their baby had one. Over Baby Powder. Johnson & Johnson suffered a Product Liability Insurance Claim for over $3.5 Billion, with an expected 40,000 more claims having been filed as of January of 2023. 1 2Similarly, Fitness product manufacturer, Peloton, had claim expenses of $19 Million due to a product liability claim.3
Because every product is different, underwriting a Product Liability Insurance policy is complicated. If you need a quote on Product Liability Insurance Coverage, please complete a product liability Insurance quote request.
1 https://fortune.com/2022/08/11/johnson-johnson-stop-selling-talc-based-baby-powder-cancer-lawsuits/
2 https://www.npr.org/2022/09/19/1123567606/johnson-baby-powder-bankruptcy-lawsuits
3https://abcnews.go.com/Business/peloton-agrees-pay-19-million-fine-treadmill-recall/story
