4 Ways to Protect Your Business from Product Liability Claims

No product is truly safe from risks, but it’s your responsibility to strive for that goal whenever you design and manufacture your products. Liability insurance is one way to protect your business against claims, but there are other steps you can take to lower your risk.

Liability insurance

1. Test Products Thoroughly

Products go through an exhaustive amount of testing before they launch, but testing shouldn’t stop once these products hit the shelf. Consistent and continued testing can help you pinpoint potential defects on the design or manufacturing of your product.

Without continued testing, you may miss a potential defect or design flaw that can lead to negligence claims. You may also be blamed for failing to recall a dangerous product.

Thorough and continuous product testing will serve as proof that you have taken reasonable steps to ensure that your product and the production process is as safe as possible.

2. Provide Effective and Appropriate Warnings

Provide consumers with effective and appropriate warnings to minimize the risk of injury and liability claims.

Failure to provide clear warnings against potential dangers can leave you open to liability claims. Even product packaging should have clear warnings if there are potential dangers.

Some states have harsher product liability laws than others, so it’s important to ensure that your warnings and labels are compliant with state laws.

Pennsylvania, for example, has more plaintiff-friendly laws, which means businesses need to be more diligent in their efforts to avoid liability claims.

“In a 2015 ruling, the Pennsylvania Supreme Court has put more of the burden of proof on the plaintiff, instilling the consumer expectations standard and the risk-utility standard in cases of strict liability claims,” says Sherr Law Group, a firm that specializes in product liability cases.

3. Transfer Liability Risk through Smart Supplier Management

Smart supplier management can also help mitigate liability risks. A risk transfer program can go a long way in helping your business avoid liability.

The goal is to get an agreement in writing that suppliers are responsible for their own negligence and errors.

It also helps to get statements of financial responsibility, such as certificates of insurance. Proof of insurance provides an extra layer of protection and helps ensure that your suppliers or contractors have coverage in case of a claim.

4. Review Customer Feedback and Make Necessary Changes

Thorough product testing can go a long way in helping you avoid liability claims, but your customers are also a great resource for pinpointing issues with your products.

Provide customers with an avenue to provide you with feedback, and consider their comments. If several customers complain about a particular issue that may become a liability problem, taking the steps to make necessary changes early on can help you avoid future claims.

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