Household appliance manufacturers engage in dangerous work with large, expensive and dangerous equipment – making risks for employee injury, equipment breakdown, product defects, fire, weather and other types of interruptions a daily concern.
Employees of household appliance manufacturers face safety concerns every day. Workers may use heavy, expensive and dangerous industrial equipment to:
- weld and cast metal or extrude hot plastics.
- build and install electrical components and motors.
If you own or operate a household appliance manufacturing facility, you need to understand all of the risks that are present and how to protect your business and your employees from devastating injuries, property damage and financial loss.
Here are some of the risks that could be present in your facility every day:
- 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
You need a comprehensive manufacturers insurance program in order to address these risks and more, depending on the specific needs of your business.
The household appliance manufacturing industry is a highly globalized industry including companies that manufacture these products:
- Household cooking appliances
- Refrigerators and home freezers
- Household laundry equipment
- Garbage disposals
- Water heaters
- Vacuum cleaners
- Toaster ovens
Large multinational corporations dominate the industry, and demand is driven by growth in consumer income and home sales.
Smaller household appliance manufacturers can compete by producing specialty products or subcontracting to larger manufacturers. Some smaller entities also produce brand named goods under contract from larger corporations. Nonetheless, the top 20 companies generate about 90 percent of the revenue in the household appliance manufacturing industry.
Overview of Manufacturing Liability Insurance
You can protect your operations, products and employees with a variety of manufacturing insurance policies tailored to your needs.
Every business needs general liability insurance for occasions in which the business is negligent and causes third-party bodily injury or property damage. A commercial general liability (CGL) policy protects you in the event of third-party lawsuits, with coverage for attorney fees, court costs, settlementsm and judgments up to the limits of your policy.
Most manufacturers have product liability exposures. Claims for product-related damage 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 never assume that the coverage is sufficient. 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 a fleet of vehicles to transport your products, equipment and other goods from place to place, you need commercial auto insurance. Commercial auto insurance covers your vehicle fleet and drivers in the event of an accident or other vehicle damage that occurs. 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.
Overview of Manufacturing Property Insurance
Most manufacturing businesses need to protect their plant and equipment from property damage caused by all kinds of unforeseen events. Your business property is susceptible to fire, theft, vandalism and natural disasters, and commercial property insurance can 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 can also include business interruption coverage, or business income coverage, which protects your earnings if your business is unable to operate because of damage caused by some type of covered disruption (fire, hail, wind, equipment breakdown). This coverage is invaluable if you are forced to close your doors for a period of time in order to make repairs. It pays for rent, employee salaries, lost income, relocation fees and more.
In addition, 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.
Covering business property can be complex if you have multiple locations. Manufacturers with multiple buildings or locations must list each one separately on the commercial property policy in order for each location to be covered. An independent insurance agent can help you calculate appropriate valuations for your plant and equipment, determine the right policy limits, and ensure that all of your owned properties are covered.
Another major property concern for metal and steel fabricators is the potential for damage to your product as it is being transported from place to place. You may often need inland marine insurance, which protects you from losses when cargo is damaged in transit. It covers a variety of shipping and transit situations including but not limited to the following:
- Shipments from a supplier to a user
- Private shipments from one party to another
- Shipments from a main warehouse to a retail outlet
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 household appliance manufacturers.
Another potentially devastating property risk for household appliance 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. While the name evokes images of old outdated machines, equipment breakdown insurance includes coverage for the latest technologies. 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 related to a breakdown of covered machinery or equipment. It may also cover related business interruption costs.
Importers and Exporters Need Cargo Insurance
Any importer or exporter who buys or sells goods overseas needs protection from huge financial losses should those goods be damaged or lost while in transit. If your goods are damaged during transit, you may lose no matter which side of the transaction you are on.
Cargo insurance covers the loss and/or damage of cargo while it is in transit by sea, air or land. It is often referred to as ocean cargo insurance, as in many cases the primary form of shipment is by boat. Cargo insurance can be standardized for all of your shipments or customized for every shipment you make or receive.
Workers’ Compensation Insurance is Required for Manufacturers
All manufacturing facilities can be dangerous places, and the safety of your employees is of utmost importance.
Your workers may come into contact with heat and welding tools, electrical components, 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.
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 manufacturers in order to make sure you have the right coverage and safety programs in place.
Find Tailored Appliance Manufacturing Insurance
While most manufacturing companies need similar kinds of business insurance, no two businesses are alike. Enlist the help of an independent insurance agent who has experience working with manufacturing businesses in order to find tailored manufacturing insurance. Independent agents in the Trusted Choice® network can work with multiple insurance companies who specialize in manufacturing insurance and who know how to write policies for businesses like yours.
Your agent will get to know you and your business and will strive to be your long-term trusted adviser.