You might think that just because you own a retail business, you can’t be held liable if a customer gets injured using a dangerous or defective product. This can be an incredibly costly and false idea to believe. Even though you aren’t manufacturing products, you still should consider getting product liability insurance.
You can be Held Responsible for Someone Else’s Defective Goods
Believe it or not, but the truth is that when a product has been found to be defective or harmful, anyone involved in the manufacturing journey can be held liable for the damage or injuries the product might cause—including you. Others that might become the target of a customer lawsuit include the following:
- The company that designed the product
- The vendors that provided the material for the creation of the product
- The manufacturer that actually made the product
- The distributor that shipped the product to the retailer
- The retailer that ended up selling the product
The vast majority of state governments in the U.S. make it possible for customers to recover damages from anyone who was involved in the product chain—and the customers don’t have to prove negligence to be awarded compensation. The only thing they should have to prove is that company did one of the following:
- Designed a product that was defective
- Manufactured a product that was defective
- Did not provide necessary instructions or warnings about the product
As a retailer, if you don’t provide customers with warnings that cover every scenario about how a product could be defective or how it might malfunction, you could find yourself having to pay for injuries that product inflicted upon a customer.
How Product Liability Insurance Protects Your Business
The best way to ensure that your retail business is protected in the event of a lawsuit is to have product liability insurance in place. Your policy will cover legal expenses, including attorney’s fees and any judgements made against you. It’s important to have this coverage if a product sold at your store causes property damage, personal injury, illness, or death.
Without having this insurance policy in place, if you get sued by a customer, you will be responsible for paying for damages and legal fees out of your own pocket. Depending on the nature of the case, this could be incredibly costly. Without product liability insurance, you may find that the expenses will put you out of business.
Do What’s Best for Your Business
The laws and rules that are currently in place make it possible for customers to sue anyone if they are injured by a faulty product. Don’t assume that they are only going to target the manufacturer or the designer. The customers may feel that as a retailer, you are to blame for making an unsafe product available for people to buy and sue you as well.
Since it’s impossible to know every scenario or way that a customer could potentially use a product (and get injured during the process), the next best thing you can do is have product liability insurance.
Finding suitable coverage for your business doesn’t have to be hard, but it will require talking to professionals. They’ll have the skills and knowledge to answer any questions that you might have about this coverage, as well as ensure that you get a policy that fits into your budget. Protect your business with product liability insurance.