What’s The Difference Between General Liability & Products Liability?

FOR PRIVATE LABEL SELLERS, PRODUCTS LIABILITY IS PRICED BASED ON THE TYPE OF GOODS BEING PRODUCED, THE POTENTIAL FOR BODILY INJURY, PROPERTY DAMAGE CLAIMS AND THE ESTIMATED GROSS REVENUE DERIVED FROM THE SALE OF THE GOODS.

General liability provides coverage for the premises and operations of a business. This can include the warehouse, personal prep area and office space needed by the business. Claims arising from the premises might include a slip and fall injury (not employee) or damage caused by an employee at a customer location.
The major types of events that are typically covered by a general liability policy:

  • Accidents and injuries to both people and property that occur on a business’ property
    or arise from its operations, including bodily injury. (Not to an employee)
  • Liability for damage to others’ property in the course of doing business.
  • Accusations of slander or libel as a result of a company’s advertising.
  • Other events, including fire damage to lessees in the case of rental property.

Products liability provides coverage for bodily injury and property damage that result from the use of your product. As a Private Label Seller, you are held liable for placing products into the hands of a consumers. Responsibility for a product defect that causes injury or death lies with ALL sellers of the product who are in the distribution chain. That includes the manufacture, manufacture of component parts, anyone who assembles or bundles, the wholesaler, reseller, and the retail outlet that sold the item.

These are major types of events that are typically covered by a Products liability endorsement:

  • Design Defects: Design was inherently unsafe from the beginning
  • Manufacturing Defects: An occurrence where a there is a malfunction or defect in the item
  • Marketing Defects: improper labeling, insufficient instructions, inadequate safety warnings

PRIVATE LABEL SELLERS ARE STRONGLY ENCOURAGED TO HAVE BOTH GENERAL & PRODUCT LIABILITY!

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