Who Is Responsible When an Imported Product Causes a Claim?
Who Can Be Named in a Product Liability Claim?
A product claim may involve more than the original manufacturer. Businesses throughout the distribution chain can be brought into a dispute depending on their role and applicable law.
Importers
A U.S. business importing products from an overseas manufacturer may face allegations involving defects, warnings, product safety, labeling, or the decision to place the product into the domestic market.
Distributors & Wholesalers
Businesses distributing products to retailers, contractors, or other customers may also become part of a claim when an allegedly defective product causes injury or damage.
Private-Label Companies
A company selling products under its own brand or label may have additional exposure because customers may view that business as the company standing behind the product.
Overseas Manufacturing Can Make Claims More Complicated
When a manufacturer is located outside the United States, recovering from that manufacturer or involving its insurance can sometimes be more complicated. Importers should understand the protection available to their own business before a claim occurs.
A claim may allege that a product was manufactured incorrectly and became unsafe because of a defect in production or assembly.
A claimant may allege that the product’s design created an unreasonable hazard even if the item was manufactured as intended.
Claims can involve allegedly inadequate warnings, instructions, labels, translations, age restrictions, or safety information.
Packaging, marketing claims, product descriptions, private labeling, or modifications made after import can create additional exposure.
What Should Importers and Distributors Review?
Product Liability protection should be reviewed together with supplier relationships, contracts, product documentation, and quality-control practices.
Maintain clear records identifying who manufactured each product, where it was produced, model or batch information, and other supply-chain details.
Review whether suppliers maintain Product Liability coverage, what limits they carry, and whether any required additional-insured protection is actually available.
Supplier agreements may address responsibility for defects, indemnification, insurance requirements, recalls, legal defense, and other product-related obligations.
Confirm that your own policy accurately describes the products, countries of manufacture, annual sales, distribution channels, and other material exposures.
Does Your Product Liability Coverage Match What You Import or Distribute?
Best Formula Insurance can help importers, distributors, wholesalers, retailers, and private-label businesses review Product Liability coverage, product classifications, supplier relationships, limits, contracts, and other product-related exposures.