Furniture manufacturers use wood, plastics, fabrics, lacquers, paint and more to fashion everything from beds to tables and office furniture. Furniture manufacturers have a tremendous range of products and materials in their manufacturing facilities – including many that are highly flammable. Some employees may at times engage in hazardous work using large, expensive and dangerous equipment, while others may craft wooden pieces with their hands, making them highly susceptible to repetitive motion and other work-related injuries.
Furniture manufacturers need a comprehensive manufacturing insurance program designed to address their unique needs.
What Risks Do Furniture Manufacturers Face?
Businesses in the furniture manufacturing industry may make a variety of items for the home and office. They may cut, bend, mold and laminate materials such as wood, metal, plastic and glass into beautiful, functional pieces of furniture.
Employees of furniture manufacturers face safety concerns every day using heavy, expensive and dangerous industrial equipment, even when simply using hand-held tools. As a business owner, you need to understand all of your business risks and how to protect your business and your employees from devastating injuries, property damage and financial loss.
Every day, furniture manufacturers face risks from employee injury, equipment breakdown, product defects, fire, weather and other types of interruptions, including the following:
- Employee safety concerns (burns, machinery dangers, slips and falls, etc.)
- Equipment and building damage due to accidents, fire, theft, weather and other natural disasters
- Machinery and equipment breakdown
- Business interruption due to accidents, fire, natural disasters, machinery breakdown, utility interruption and more
- Damage to products in transit
- Product defects and recalls
Protect Your Business Property First
Furniture manufacturers can be considered high hazard businesses because of the numerous flammable materials on the premises as well as the highly valuable parts and inventory that may be on hand.
Your buildings and equipment are susceptible to fire, theft, vandalism and natural disasters. You need commercial property insurance to protect your building and other property in the event of a covered loss.
Commercial property insurance protects your business if a fire, vandalism, smoke, theft or another covered peril (cause of loss) damages your property. It provides coverage for lost inventory, industrial equipment and machinery, warehouses and office space, office equipment, computers, valuable papers, and more. It may also provide coverage for neighboring facilities and completed products housed on your premises.
Commercial property insurance policies usually include business interruption coverage, or business income coverage, which protects your earnings and helps to pay expenses if your business is unable to operate because of damage caused by some type of covered disruption (fire, hail, wind, equipment breakdown). And you can expand your business income policy to include coverage for breakdowns in utility services (water, electrical) that force you to temporarily close your doors.
Determining how to best to cover all of your business property is essential. You need to work with an experienced independent insurance agent who can help you evaluate and calculate appropriate valuations for your plant and equipment and determine the right policy limits. An agent with experience writing furniture manufacturer insurance can help you properly differentiate coverage for your building, heavy equipment and other contents. You can expect your agent and underwriter to pay close attention to how you handle the flammables on your property. In order to secure the best coverage and rates, you must be sure to make safety and fire prevention in your plant a top priority.
You may need additional coverage for your product as it is being transported from place to place. Your shipping contracts determine which party is responsible for a product as it is transported, and in cases where you are responsible for items in transit, you may need inland marine insurance.
Inland marine insurance protects you from losses when cargo is damaged in transit. Any piece of property that is moved from one location to another can be covered with an inland marine policy. The best way to ensure that you find the right type of inland marine coverage for your needs is to work with an independent agent who has experience working with furniture manufacturers.
Another potentially devastating property risk for furniture manufacturers is damage to or breakdown of equipment. Without your specialized equipment, your business would be unable to operate, pay for expenses and earn revenue.
Equipment breakdown insurance, often referred to as boiler and machinery coverage, supplements your business property insurance. It covers certain costs associated with accidental breakdown of machinery or equipment and the resulting property damage or loss.
Equipment breakdown coverage typically covers breakdowns due to power surges, motor burnout, boiler malfunction and even operator error. You can obtain coverage for mechanical and electrical equipment, computers and computer systems, boilers, and other types of pressure equipment.
Boiler and machinery insurance covers repair and replacement costs, as well as business interruption costs, related to a breakdown of covered machinery or equipment.
Protect Your Employees
The safety of employees in a manufacturing environment is of utmost importance. Furniture manufacturing facilities can be dangerous places. Your workers may come into contact with heat and welding tools, cutting tools, heavy machinery, and numerous dangers to fingers, toes, eyes and other appendages. Employees who regularly work with hand tools are particularly vulnerable to repetitive motion injuries. And constant exposure to lacquers, paints and other chemicals also can be potentially dangerous to workers.
Keeping your employees safe from work-related injuries and illnesses is important for your employees’ long-term health and satisfaction as well as your company’s financial viability. Excessive employee injuries and illnesses can be financially devastating for your business.
Workers’ compensation insurance provides insurance coverage when accidents happen at the workplace. It ensures that the injured worker gets medical care and income protection while unable to work.
Workers’ compensation insurance provides benefits to injured workers regardless of who is at fault for their injury. And it provides death benefits for a worker’s dependents if the worker is killed.
Your insurance agent can help you navigate your state’s workers’ compensation laws and requirements. Each state has different rules for the amount of benefits injured employees are entitled to, what impairments or injuries are covered, how impairments will be evaluated, and how medical care will be delivered.
Almost every state requires employers to carry workers’ compensation insurance – with a few exceptions. It is a complex type of insurance that is essential to the long-term survival of your business. And purchasing workers’ compensation insurance is not enough; implementing safety programs and insisting on worker compliance is the only way to keep your workers’ compensation claims and costs under control.
Find an experienced workers’ compensation insurance agent who has experience with furniture manufacturers in order to make sure you have the right coverage and safety programs in place.
Liability Claims Are Common for Furniture Manufacturers
Furniture manufacturers are susceptible to a variety of liability risks. You can protect your operations, products and customers with a variety of business liability policies designed for furniture manufacturers.
You may not typically have customers or the general public on your premises, but you still need general liability insurance for occasions in which your business is negligent and causes bodily injury or property damage to a third party. Your commercial general liability (CGL) policy protects you in the event of third-party lawsuits, with coverage for attorney fees, court costs, settlements and judgments up to the limits of your policy.
Like any company that manufacturers a product, you may also have product liability exposures. Claims for product-related damages are usually related to manufacturing or production flaws, design defects, or defective warnings or instructions. If you are sued for some type of product negligence, you may be required to pay for medical costs, compensatory damages, economic damages, attorney fees, court costs and more.
Product liability insurance covers your financial responsibility for losses or injuries to a user, buyer or bystander caused by a defect or malfunction of your product. Some product liability coverage is usually included in standard commercial general liability (CGL) policies, but this coverage may not be sufficient for a furniture manufacturer. You need an experienced agent to help you determine how much product liability exposure you have and how much and what type of coverage you need.
If you own trucks or other vehicles, commercial auto insurance covers your vehicle fleet and drivers in the event of an accident or other vehicle damage. Commercial auto insurance provides coverage for property damage and bodily injury liability claims, vehicle damage and medical bills as well as any costs related to lawsuits due to auto accidents involving your vehicle fleet.
Fleet safety is very important for any company that engages in trucking. Working together with your independent insurance agent, you can design and implement insurance and safety programs that keep your drivers safe, your cargo intact and your insurance rates under control. Employing only highly qualified drivers and requiring unfailing safety practices should be top priorities.
Talk to your independent insurance agent about your need for excess liability, or commercial umbrella insurance. Commercial umbrella insurance provides an extra layer of liability protection to any of several other policies you might have, including commercial general liability, employer’s liability, and hired and nonowned auto liability. By purchasing one commercial umbrella policy, you essentially get higher limits on all of those policies rather than having to raise the limits on each policy individually. Commercial umbrella insurance kicks in when the limits of your other applicable insurance policies have been exhausted, protecting you in the event that a claim exceeds the amount of coverage available from any other applicable policy.
Find Furniture Manufacturer Insurance Tailored to Your Business
Whether you are a large office furniture manufacturer or a small artisan woodworker, you need tailored furniture manufacturing insurance to protect you from the unique exposures inherent in your business. By working with an independent insurance agent, you can obtain quotes from numerous, reputable insurance companies that specialize in your line of work. You don’t have to spend time chasing down quotes on your own – your agent can function as a trusted adviser who can help you find the right mix of coverage for your needs and budget.