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Product liability laws are in place to protect consumers against products that are defective and may cause them harm. For businesses that operate in the manufacturing industry, this is a constant risk. According to the law, it’s the responsibility of the manufacturer to ensure the products they produce are safe for public use. This may seem like a daunting responsibility, therefore we want to highlight product liability claims and provide you with measures to protect your business from lawsuits. 

How Manufacturers, Distributors, & Retailers Can Protect Themselves

Why Is It Important? 

It is important to understand product liability laws so you are able to protect your business in the case of a claim. A recent product liability example is when a woman filed a claim against NutriBullet after she sustained cuts and burns from one of their blenders.  This is not the first claim made against NutriBullet for their “exploding” blenders. Lawsuits like these can be extremely detrimental to the reputation and well-being of a business. Although NutriBullet argues that the injuries were caused because of product misuse, the lawsuit will still cost them money, time, and tarnish their reputation. 

3 Ways To Protect Your Business

In your efforts to warn consumers about any potential danger your product may present, warning labels are just not enough. Recent cases have shown us that courts will rule against manufacturers in favor of the plaintiff even though they placed the necessary warning labels on their products. This trend shows why it’s so important to take every precaution possible. The following are 3 measures your business can take to stay protected:

Contractor license bonds are bonds that establish rules and procedures for which a contractor must conduct business. Contractor license bonds will establish that a business must be administered in accordance with all state laws and regulations, and that business must be conducted in a good and law-abiding manner, including ethical standards. Contract licenses can vary by state and local law, and operations or requirements for functionality can be determined through differing constituency divisions including cities, municipalities, and more. 

  • Product testing: Many business owners feel inclined to stop the testing of products once they hit the market. However, it’s in the best interest of your company to continue product testing even after it has launched. This can help you identify potential defects or problems with the manufacture and design of your product that can put your business at risk. This also ensures that your company took thorough, appropriate action during the evaluation of your product to prevent any defects. 

  • Keep safety in mind when designing: Many of the potential hazards, risks, and defects can be avoided during the design stage of product development. By taking into account how your products will be used and what hazards they may present, you can take preventative safety measures to ensure they meet or even exceed all federal and industry safety standards. Of course, some products such as trampolines, magnets, or tools can be dangerous in nature. Therefore, products should be reviewed periodically to ensure no new dangers or hazards exist. 

  • Purchase product liability insurance: Although it’s not mandated by law, it’s a good idea for any company that manufactures goods to have product liability insurance. This coverage can be very beneficial if the claim were to go to court. If a consumer files a claim because they were injured by one of your products, the policy covers the award that an individual would receive if the court rules against your company. Keep in mind that coverage options may vary, so it’s important to do research before purchasing any type of insurance. 

Additionally, it’s important to note that people will sometimes make frivolous claims in an attempt to scheme money from a company. In order to combat this, it’s recommended to keep an attorney on retainer whom you can consult about any product liability claims. 

Ensure Your Organization Is Protected 

Product liability lawsuits have the second-highest median damage award out of all personal injury cases at around $300,000. Not only does your company lose all this money, but also a great deal of time and resources. That’s why it’s necessary to take all precautionary measures to ensure your business is protected. At Biscayne Risk & Insurance, we can help guide you through the complexities of the insurance industry and provide you with the best coverage for your business. For more information on how we can be of service to you, please reach out to us today!

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