Compare product liability insurance

Product cover protects your business if something you make, sell, import or supply is said to have hurt someone or damaged their property. Manufacturers, importers, online sellers and shops all carry this risk.

You can request quotes on Quotezone with one form, for product cover on its own or as part of a wider business policy.

Who can be held liable for a faulty product?

More people than many sellers expect. Under section 2 of the Consumer Protection Act 1987, which covers England, Wales and Scotland, liability for damage caused by a defect can fall on the producer (legislation.gov.uk).

It can also fall on anyone who brands a product as their own, and on whoever brought it into the UK to sell (legislation.gov.uk). Other suppliers can be liable too if they cannot say who supplied the item to them.

The Act treats a product as defective when its safety falls short of what people are generally entitled to expect (legislation.gov.uk).

Do online sellers and importers need product cover?

It is worth considering if you bring goods into the UK or sell them under your own brand. The business.gov.uk guidance recommends product liability insurance for anyone who makes, sells or distributes products (business.gov.uk).

Marketplaces and retailers may also ask to see cover before they list your goods. Check the limit they require, and whether it must apply to sales worldwide or only in the UK.

Public liability and product liability: what is the difference?

Public liability covers injury or damage caused by what your business does, such as a visitor tripping over a box in your shop. Product cover deals with harm caused by the goods themselves, after they have left you.

Many insurers sell the two together as “public and products liability”. See our public liability insurance page if your main risk is people visiting you or you working on their premises.

Recalls, exports and other gaps to check

Standard policies often leave out some risks, or charge extra for them, so read the schedule for these points before you buy:

• Product recall: the cost of pulling faulty goods from sale is often a separate cover.
• Exports: sales to the USA and Canada are commonly excluded unless you declare them.
• Design faults: if you design products for other firms, professional indemnity insurance may be needed too.
• Your own stock: goods lost or damaged in storage or in transit need property cover or goods in transit insurance.

Products that insurers look at closely

Some goods carry a higher chance of harm, so insurers ask more questions and may set conditions. Common examples are:

• food, drink and supplements
• cosmetics, skincare and anything applied to the body
• toys and products for babies and children
• electrical items, chargers and batteries
• candles and other items that involve heat or flame

Testing records, safety marks and clear instructions all help show an insurer how you manage the risk.

Selling through online marketplaces

Marketplace sellers often import from overseas factories and sell under their own brand name. That can put them in the producer or importer position under the 1987 Act, which applies in England, Wales and Scotland, even if they never touch the goods.

Some marketplaces set a minimum level of product cover for sellers above a certain turnover. Read the seller terms, and keep the policy in force for as long as goods you sold could still be in use.

Records that help defend a claim

Good paperwork can decide a claim. Keep supplier invoices, batch or serial numbers, test certificates and copies of the instructions and warnings that went out with each product.

If a customer complains, note the date, the product and what happened, and tell your insurer early. Late notice can affect cover.

Making goods for other businesses

Contract manufacturers and component suppliers sit further up the chain, but a faulty part can still lead to a claim when the finished product fails. Supply contracts often include indemnities that pass that risk back to you.

Read any indemnity clause before you sign, and send a copy to the insurer if it asks you to take on more than the law would. Some policies will not cover liability you have agreed to by contract alone.

What affects the cost of product cover?

Insurers look mainly at what you sell and where it goes. Typical factors are:

• the type of products and how they could cause harm
• whether you make, import, brand or only resell them
• turnover from product sales and the countries you sell into
• the limit of indemnity you choose
• quality checks, testing records and previous claims

An online importer selling phone chargers

Here is an illustrative case. A small business imports phone chargers and sells them online under its own brand. Under the 1987 Act it could be treated as importer and producer, so product liability insurance with a suitable limit matters more for it.

A shop reselling well-known branded goods has a lighter exposure, and a candle maker at craft fairs faces mainly fire and burn claims.

Comparing product liability insurance quotes

Tell us what you sell, your turnover and where your customers are. UK providers on the Quotezone panel reply with prices, and you can check territories, limits and exclusions before you choose.

Start your product cover quote now.

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