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Businesses that create, manufacture, distribute and sell products should consider product liability insurance. This type of coverage protects your business from costs if a product doesn’t work properly and causes harm to a third party.
Defects in your company’s product could cause injury or property damage. Even if a product is used incorrectly by the customer, a business could be liable for any damage caused by the product.
Product liability insurance also covers legal fees, medical costs and compensatory damages brought forth in third-party lawsuits. The potentially high cost of lawsuits makes product liability insurance a vital component of a small business insurance plan.