Product Liability.
You do not have to be careless to be liable. You only have to be in the chain.
Product claims run on strict liability, which means the question is whether the product was defective rather than whether you were negligent. Everyone who touched it commercially can be named: the manufacturer, the importer, the distributor and the shop that sold it.
Most businesses have some product cover inside their general liability and have never checked the limit. On a serious injury claim that sublimit is what stands between the business and the judgment. Send us your policy and we will find it.
Strict liability, not negligence
In most liability claims the question is whether you were careful. In product claims it usually is not.
Fault is not the test
If the product was defective and it caused harm, liability can attach regardless of how carefully you handled it. Proving you did everything right is frequently not a defence.
Everyone in the chain
Manufacturer, importer, distributor, wholesaler and retailer can all be named in the same claim. Plaintiffs sue broadly and let the parties sort it out afterwards.
The reachable defendant pays
If the manufacturer is overseas or insolvent, the domestic seller becomes the practical target. That is not a theoretical risk; it is the ordinary pattern.
Claims arrive years later
Products stay in use long after they are sold, and the policy in force when the claim is made is what matters. Continuity of cover is not optional.
What actually gets alleged
Understanding which category a claim falls into tells you where your real risk sits, and it is rarely the one owners worry about.
Manufacturing defect
One unit came out wrong. Contained, usually the easiest to defend, and the least common source of large claims.
Design defect
The product is unsafe as designed, which means every unit ever sold is implicated. This is where catastrophic exposure lives.
Failure to warn
The product performed as intended and the labelling, instructions or warnings were inadequate. The most common allegation by a wide margin, and the cheapest to prevent.
Where prevention pays
Labelling and instructions cost almost nothing to get right and defend a disproportionate share of claims. Carriers notice when a business takes it seriously.
Where the gaps usually are
Imported goods
You inherit the manufacturer’s exposure in practice. Supplier indemnities are only as good as the supplier’s ability to pay and your ability to enforce across borders.
Private label
Putting your name on someone else’s product generally makes you the manufacturer in the eyes of the law. Many businesses do this without realising what it changes.
Modified or repackaged goods
Altering, assembling or repackaging can move you up the chain from seller to manufacturer for liability purposes.
Export sales
Many policies exclude claims brought outside the United States, or in specific jurisdictions. Selling internationally without checking that clause is a common and serious gap.
High-risk categories
Anything ingested, applied to skin, used by children, or carrying an electrical or mechanical hazard is underwritten differently and needs a specialist market.
Completed operations
For contractors and installers, work performed is treated much like a product. The exposure continues long after the job is finished.
Find the sublimit, then the market
Most businesses discover their product limit during a claim. That is the wrong time, and it is entirely avoidable.
Find the products limit
It frequently sits inside the general liability aggregate rather than beside it, which means one large claim can consume the coverage protecting the rest of the business.
Chase vendor endorsements
If you resell, ask every manufacturer to name you as an additional insured with vendor status. It costs you nothing and it is the single most effective step a retailer can take.
Check the territory clause
Where the policy will and will not respond geographically. Online sellers and exporters are routinely uncovered here without knowing.
Then shop appetite
Product liability is written by specialists, and appetite by product category swings hard. A line one carrier declines outright is another’s core class.
Send us your policy and we will find the products sublimit.
That figure, whether it shares the general aggregate, and what the territory clause says tell you far more about your real protection than the headline limit does. No cost, no obligation.
Product liability, answered plainly
We only resell. Are we liable for someone else's product?+
Frequently yes. Strict liability can attach to anyone in the distribution chain, and injured parties name everyone. If the manufacturer is overseas, insolvent, or hard to pursue, the seller often becomes the practical defendant.
Is it not included in general liability?+
Usually there is products and completed operations cover inside a GL policy, and for many businesses it is adequate. The question is the limit and the exclusions, because certain products, industries and export markets are carved out entirely.
What counts as a defect?+
Three categories. A manufacturing defect is a flaw in one unit. A design defect makes the whole product line unsafe as designed. Failure to warn means the product was fine but the labelling or instructions were not, and this is the most common allegation of the three.
What is a vendor endorsement?+
An endorsement added by a manufacturer's policy that extends coverage to the retailers and distributors selling their product. If you resell, obtaining vendor status from your suppliers is one of the cheapest protections available and it costs you nothing.
Does it cover a recall?+
Generally not. Liability covers injury and damage caused by the product; the cost of withdrawing and replacing it is product recall coverage, which is separate. For food, cosmetics, supplements and children's products, recall cover is worth serious consideration.
What about products we import?+
Importers are treated much like manufacturers, because the foreign maker is often beyond practical reach. Anyone importing should assume they carry the manufacturer's exposure and insure accordingly.
Do we need it if we sell online only?+
Yes, and selling online widens it. You may be exposed in every state you ship to, and the major platforms require proof of product liability cover above modest sales volumes.
What reduces the premium?+
Documented quality control, clear labelling and instructions, written supplier agreements with indemnity, vendor endorsements from manufacturers, and a clean claims history. Carriers ask about all of it and price it accordingly.