Manufacturers – are you aware of the potential gaps in your insurance cover?

If you’re a manufacturer and hold a general liability (GL) policy, you may have some gaps in your cover that you didn’t realise.

While you’ll likely to be covered for bodily injury and property damage resulting from your products, services, or operations,¹ there are some critical exposures your GL policy might not cover. This could include:

Directors and officers duties

Rising regulation and an increasingly litigious society means that your directors are at risk of a claim. Any allegation of potential wrong doing from shareholders, creditors, regulators, competitors, and employees will need to be investigated or defended.

A management liability policy can provide protection for both the directors’s assets, and your business’s, from a wide range of actions and allegations.

Product recalls

Product liability risks are increasing for many manufactures, given the tendency to source components or food ingredients from parts of the world lacking strong regulatory oversight. If something goes wrong, a product liability event can affect your brand, reputation, and bottom line if not handled well.

A product recall policy can provide cover for first and third party costs and financial losses sustained when a product is recalled.

Cyber-attacks

Cyber security is becoming a top concern for manufacturers who need to assure the availability of their manufacturing operations, protect intellectual property, and safeguard customer and supplier data.² The growing convergence of IT and operational technology gives hackers an ever wider range of opportunities to launch attacks on industrial systems.

A comprehensive cyber policy helps protect you against the financial loss resulting from cyberattacks, data breach, system failures and much more.

Intellectual property (IP)

For most manufacturers, design rights and patents are the most vital when it comes to IP.3  Intellectual property insurance will help provide protection for the patents, trademarks and copyrights that make you competitive and successful.

Additional exposures your GL policy might not cover

• product failure
• defective workmanship
• damage to products supplied
• liability arising from advice or design provided for a fee and not connected with the supply of your own products.

Finally, if you’re a manufacturer of medical devices and nutraceuticals, this huge responsibility comes with a complex set of risks such as injury to a user, or potential patent litigation. A comprehensive life science policy provides coverage for a wide range of exposures for your specialist activity risks.

Concerned about your cover?

Our manufacturing insurance team are here to help. Alternatively, head over to our manufacturing hub, your one stop shop for insurance, risk management and employee wellbeing support.

^Sources:

^{1. https://www.cfcunderwriting.com/en-gb/resources/articles/2021/06/five-manufacturing-exposures-not-covered-by-general-liability-insurance/
2. https://www2.deloitte.com/us/en/pages/manufacturing/articles/cyber-risk-in-advanced-manufacturing.html
3. https://www.themanufacturer.com/articles/how-manufacturing-stays-innovative-thanks-to-intellectual-property/}