Under the policy of product liability the insured is legally responsible to pay if any loss or damage caused by his manufactured product which gave rise to death or any vulnerable disease to the third party, or any damage caused to the third party’s property.
Defect may arise in the product due to wrong packaging or improper delivery or it may arise in the manufacturing unit itself. So this policy of product liability gives coverage for turnover of sales of a company.
In any product is recalled then no liability will be covered by the policy, same goes in case of any liability occurred due to product assurance, market loss, goodwill loss and any loss incurred during defective product repairing.
This policy is also extensive to cover certain charges that may arise out of decision made in other countries functioning under the rules and regulations of U.S.A. The same can also be extended to cover limited charges for vendors whether unnamed or named.
Any person or manufacturing unit involved in production of products can take this policy.
While making claim under this policy of product liability one should notice certain things. When any liability occurs straight away the company giving insurance should be well-versed without making any delay. If any lawful notice is acknowledged, the same should be delivered back to the company. Making arrangements for the case is the alternative of the insurance company. One more thing to be noticed during making any claim is that the event should occur within the insurance period and must be presented in writing.