Businesses in the manufacturing, wholesale, and retail sectors are the primary beneficiaries of product liability insurance. Product liability insurance is often included in a business's commercial general liability policy with coverage for other liability risks.
Coverage for product liability claims is often included in a manufacturer's general liability insurance. Fewer potential risks are connected to third parties not tied to product liability since manufacturers do not often have significant foot traffic from third parties. The company's premiums are mainly determined by the goods it sells.
Wholesalers have more significant third-party exposures than manufacturers because of the unending flow of delivery vendors. Product liability lawsuits may also affect wholesalers if they sell a dangerous or defective item. If a wholesaler is careless, provides product labeling or advice on using a product, or offers installation services, they may be liable for any resulting damages. Wholesalers may not be entirely protected by manufacturers' commercial insurance policies, even though some manufacturers may offer indemnity for distributors in their contracts and list insurance packages that include wholesalers as additional insureds.
Product liability risks for retailers are comparable to those for wholesalers. While product liability claims concern any business, many retailers face greater danger from day-to-day operations, such as customers tripping over merchandise. It's possible that retail-specific exposures, rather than product liability risks, are the primary drivers of insurance costs for stores that purchase a general liability policy to cover potential product liability claims.