The manufacturing industry includes many different trades, with each differing in equipment, skills, and risk. Regardless of the machinery or how the product is made, risk assessments help minimize hazards on the manufacturing floor. Despite modern safety improvements, manufacturing is still a dangerous occupation. Consequently, injuries can result in lawsuits, affect employee morale, and decrease productivity.
With over 100,000 manufacturing workers injured each year, manufacturers must protect themselves from unforeseen incidents that can adversely impact their business. Many injuries can be prevented by establishing a work environment that puts safety first. However, it does not guarantee an injury-free workplace. Although taking preventive measures is helpful, it still presents exposures and risks.
The Importance of Commercial Insurance
Veteran manufacturers know the importance of a smooth operation and meeting the needs of both employees and clients. A simple malfunction of machinery can stop production, and an injured employee could leave a business liable for damages. That’s why manufacturing insurance is extremely important, for it can prevent the financial failures that resulted in numerous manufacturing companies going out of business.
Without the proper insurance, a company would be responsible for all expenses associated with an incident. The high costs can cripple any business, especially a small business. Injuries and other legal matters are also time-consuming and cumbersome, particularly when there are production deadlines to meet. However, adequate insurance coverage can minimize expenses by paying legal fees, lost wages, and medical bills.
Best Insurance Options for Manufacturing Businesses
There are a variety of commercial insurance options available for manufacturing businesses, but the following five offer an airtight solution to financially protecting any company.
Commercial Property: Commercial property insurance provides coverage for the company’s physical building, where all the manufacturing occurs. If the property is damaged due to a fire, flood, or natural disaster, the policy will cover the cost of equipment along with damages.
Product Liability: Product liability insurance covers negligence claims that are made by clients. It also covers legal costs. Therefore, should a manufacturer’s product injure someone or make them ill, this coverage provides a payout.
Product Contamination: Product contamination provides coverage in the event a product is contaminated. The contamination can result from a criminal act or an error. Many insurance carriers offer policies that include inventory destruction, business interruption, lost profits, and product rehabilitation.
Workers Compensation: Worker’s Compensation covers an employee that is injured on the job. Damages include lost wages and medical bills resulting from the injury.
Commercial Auto: All business vehicles should be covered by a commercial auto policy.
Workplace safety in manufacturing facilities is achievable once the potential hazards are known. A risk assessment can help manufacturers stay mindful of the hazards while minimizing financial risk with adequate insurance coverage. Working with a knowledgeable commercial insurance broker who understands the unique requirements of manufacturing is important when deciding on coverage types. Lastly, manufacturing insurance provides great protection for commercial properties, worker’s compensation, and product liabilities by decreasing financial losses and avoiding interruptions.