5 Steps to Getting a Better Product Liability Quote

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Since we specialize in start-up businesses, I probably receive at least 50 calls per week from manufacturers, distributors and importers looking for a product liability insurance quote. Here are five steps you can take that will help you get a fast product liability quote.

1. More information about your products is always better than too little.  When you submit a product liability application, it is to your benefit to provide as much information about the products you want to insure. The underwriter needs a good understanding of your products and business.  This includes websites, product brochures, labels with list of ingredients,and  independent test reviews and certifications.  Without full and complete disclosure, the underwriter may think you are trying to hide something and may refuse to consider your application. Or, if they do provide you a product liability quote, they may prefer to err on the side of caution and charge you a higher rate and premium.
2. Include all insurance contract requirements with your product liability insurance application.  It is not uncommon for businesses to purchase insurance and find out later that they either do not have the correct limits of liability or they should have purchased an occurrence policy instead of the cheaper claims-made policy.  Including your insurance contract requirements with your application will help your insurance agent provide you with the correct quotes the first time and not waste your time having to get new quotes or rack up unnecessary expense having to cancel your old policy and purchase a new one.
3. Take time to understand the difference between Claims-made and Occurrence policies  Start-up businesses owners typically want the cheapest insurance they can buy. They often incorrectly assume they can upgrade their insurance once they become more established.  Because of the retroactive date associated with a Claims-made policy, it can sometimes be impossible to convert coverage to an Occurrence policy without losing coverage for all the years you owned a claims-made policy. See Understanding Occurrence vs. Claims-made policies.
4. Know if your agent specializes in Product Liability.  Simply put, an agency or brokerage that has placed millions of dollars of business in Product Liability Insurance is going to have better relationships and more power to get things done within the product liability insurance industry. They’ll also be in a better position to negotiate a competitive rate and premium on your behalf than the general agency that tries to be everything to everybody.
5. Be truthful on your product liability insurance application.  If you omit information or do not tell the truth on your application, you are setting yourself up to potentially have your claim denied should you be involved in a lawsuit.  When you file a claim, one of the first things your claims adjuster in going to do is review your original application for material misrepresentations.  A material misrepresentation is any statement which if answered correctly, would have been a reason for the insurance carrier to deny the application under its underwriting criteria.  Any material misrepresentation on your product liability application could result in your claim being denied and as result no insurance money to handle your legal defense, settlement or adverse jury verdict.

If you have questions about the application process or simply want a quote, call Paul Owens at 800-622-7370