RESPECT Liability insurance for damage caused by defective products
The obligation to compensate for injury caused by a defective product and the necessity to spend costs on recalling the product from the market represent a great threat to the manufacturer, because it could cause not only financial losses but also loss of the brand's prestige.
The purpose of insurance is coverage of the obligation to compensate for injury to health or property of third parties, which occurred in relation to use of the insured party's product, which did not guarantee safety features, which would be possible to justifiably expect, and for which the insured party is obliged to compensate.
It is designed for:
- all entities manufacturing products (including food and beverages) or semi-finished goods, that provide services or sell products of third parties
This relates to:
- Damage caused by product defect. A defective product can also been considered poorly performed work (service supplied by the insured party), if their defect appears after their handover
Insurance on the case of recalling a product from the market relates to:
- Costs for notifications and advertisement
- Costs for transport and accommodation of persons
- Wage costs for newly hired employees
- Costs for transporting products from any acquirer
- Costs for reclassification of products
- Costs for repair of defective products and for replacement of defective product components
- Costs for product retesting, costs for checkout and final inspection
- Costs for repeated product distribution
- Costs for transport of reliable products/parts to the place of averting damage
- Costs for storage space rental
- Costs for destruction of a defective product, etc.