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Liability Insurance

Product Liability Insurance Policy

ProductLiabilityInsurancePolicy

Key Features

Safeguard your organization with product liability protection

Coverage Highlights

This policy safeguards businesses against claims related to products they manufacture or sell
  • Coverage for Legal Liability

Provides coverage for legal liability arising from accidental bodily injury or property damage caused by the insured's products

  • Claimant's Costs and Defense Costs

Covers costs for investigating, defending, or settling Claims, including representation

  • Indemnity Limit

The policy includes a limit of indemnity, which is the maximum amount the insurer will pay for claims, which includes Damages and Defense costs

  • Accidental Bodily Injury and Property Damage

Covers claims arising from accidental bodily injury or property damage caused by the insured's products to a third party

  • Business Operations

The coverage applies to claims arising solely in the course of the insured's business operations

Inclusions

What's covered
  • Legal Liability

Covers legal liability for third-party accidental bodily injury or property damage caused by your products

  • Claimant's and Defense Costs

Includes claimant's costs, fees, and defense expenses

  • Business Operations

Applies to claims arising in the course of your business operations

  • Note

Please read policy wording for detailed explanation..

Key Exclusions

What’s not covered?
  • Defective Product Repair

Excludes repair, reconditioning, modification, or replacement of defective products

  • Product Recall

Excludes the recall of any product or its parts

  • Aircraft Products

Excludes products known to be for aircraft structure, machinery, or control

  • Product Performance Failure

Excludes failure of products to fulfill their intended purpose

  • Product Guarantee

Excludes any product guarantee

  • Assumed Risk

Excludes agreed risk assumptions unless liability exists without the agreement

  • Non-Compliance Accident

Excludes accidents from deliberate, willful, or intentional statutory non-compliance

  • Employment Bodily Injury

Excludes bodily injury to employees or subcontractors during employment

  • Consequential Loss

Excludes consequential losses like profit, opportunity, business interruption, market loss, or goodwill

  • Intellectual Property Infringement

Excludes infringement of plans, copyrights, patents, trade names, trademarks, or registered designs

  • Defamation and Personal Injury

Excludes libel, slander, false arrest, wrongful eviction, wrongful detention, defamation, and resulting mental injury

  • No-Fault Liability

Excludes liability under the Public Liability Insurance Act 1991 or any other no-fault liability law

  • Management Neglect

Excludes claims from management's deliberate, conscious, or intentional neglect to prevent bodily injury or property damage

  • Pre-Insurance Period Claim

Excludes claims made, threatened, or intimated against the Insured before the insurance period

  • Note

Please read policy wording for detailed exclusion list

What is Product Liability Insurance (PLI)?

Product Liability Insurance (PLI) protects businesses against claims related to the safety or quality of the products they sell or manufacture. This insurance covers legal fees, damages, and compensation costs that arise from injuries or property damage caused by defective products. Whether your business manufactures goods or resells them, PLI is crucial in safeguarding against potential financial losses from product-related lawsuits.

In today’s litigious environment, product defects, malfunctions, or misinformation can result in costly claims. A solid product liability insurance policy provides peace of mind, ensuring your business can handle the unexpected and continue operating smoothly. This cover can be tailored to meet the specific risks associated with your business, offering protection across various sectors, including retail, manufacturing, and more.

Benefits You Deserve

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Financial Security

Ensure financial stability with comprehensive coverage

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Safeguard your Brand

Protect brand reputation effectively

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Customisable Policies

Tailored plans for various product categories

Download Policy Document

Get instant access to your policy details with a single click.

What Does Product Liability Insurance Cover?

Product Liability Insurance (PLI) is designed to protect businesses from the financial implications of third-party claims related to the safety of the products they manufacture, distribute, or sell. If a product causes injury to a person or damage to property, PLI provides coverage for legal fees, settlements, and compensation claims, ensuring that your business can recover from such unexpected costs.

This insurance covers claims arising from manufacturing defects, faulty designs, and inadequate warnings or instructions. If a product malfunctions and causes harm to a consumer or damages property, the business is responsible for compensating the affected parties. PLI helps protect your business by covering:

  • Bodily Injury : Legal fees and medical costs for injuries caused by a product.
  • Property Damage : Claims resulting from a product damaging a person’s property.
  • Legal Defence : Costs associated with defending against lawsuits, including attorney fees and court settlements.

PLI is essential for businesses of all sizes, offering security against claims that could otherwise cripple operations. From startups to large manufacturers, having this coverage ensures your business is protected, your reputation is safeguarded, and your financial future remains secure.

Why Do You Need Product Liability Insurance in India?

In India, where consumer protection laws are rapidly evolving, Product Liability Insurance (PLI) has become an essential tool for businesses. Whether you manufacture, distribute, or sell products, the risk of facing a product-related claim is high. The country’s stringent consumer protection laws, along with increasing consumer awareness, make it crucial for businesses to have adequate insurance coverage.

  • Legal Protection : In case a defective product leads to harm or damage, businesses can face hefty compensation claims. PLI helps cover legal fees, settlements, and compensation costs, reducing financial strain.
  • Compliance with Regulations : With increasing regulatory scrutiny in India, businesses must comply with safety and quality standards. PLI ensures businesses are prepared to handle potential claims and meet regulatory requirements.
  • Reputation Management : Product defects can tarnish a brand’s image. Having PLI shows that your business takes consumer safety seriously and is prepared to handle any claims.
  • Market Confidence : Clients, partners, and customers trust businesses with proper liability coverage, making PLI a key part of your business strategy.
  • Affordable Protection : Compared to the financial risks posed by lawsuits, PLI offers affordable coverage that can prevent major financial losses.

Who Should Consider Product Liability Insurance?

  • Manufacturers : Any company that produces goods should consider PLI to protect against defects or malfunctions in their products.
  • Wholesalers & Distributors : Businesses involved in distributing or reselling products may also be held liable if a defective product causes harm or damage.
  • Retailers : Even if you do not manufacture the products you sell, you can still be held responsible if a product is found to be defective.
  • Importers : Companies that import goods from other countries are exposed to risks if those products cause harm or damage once sold.
  • Contractors & Builders : If you use products in construction or installation that cause injury or damage, having PLI is crucial for covering potential claims.
  • Food and Beverage Providers : Businesses that sell or serve consumables are at risk of product liability claims, especially related to contamination or unsafe ingredients.
  • Cosmetic Manufacturers : The beauty industry faces significant risks related to the safety of ingredients and the final product.
  • Tech and Electronics Companies : Manufacturers of electronic devices or gadgets must protect themselves against claims related to product malfunctions or defects.
  • Importers/Exporters : Importers who sell foreign-made products should secure PLI to mitigate risks tied to foreign laws and product standards.

Available Add-Ons for Product Liability Insurance

  • Product Recall Coverage : If a product needs to be recalled due to safety concerns or defects, this add-on covers the associated costs, including communication, logistics, and disposal expenses.
  • International Coverage : If your products are sold overseas, this add-on ensures protection against claims made in foreign countries, adhering to international liability laws.
  • Environmental Damage Coverage : This covers claims arising from a product causing environmental harm, such as pollution or contamination.
  • Subcontractor Liability : If your business hires subcontractors who contribute to product manufacturing or services, this add-on covers potential claims resulting from their actions.
  • Extended Coverage for Product Warranties : This covers products that come with a warranty, protecting against claims arising from product failures under warranty.
  • Cyber Liability for Product Data : If your product collects or handles consumer data, this add-on covers claims resulting from data breaches or cyber incidents.
  • Legal Expense Cover : This covers legal costs for defending against product liability claims, ensuring your business can afford proper legal representation.
  • Faulty Design Coverage : For manufacturers, this add-on protects against claims arising from product design flaws, including compensation for consumers who are injured by a faulty design.

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Step-by-Step Guide

To help you navigate your insurance journey

How to Buy

  • 0

    Visit the Bajaj Allianz General Insurance website

  • 1

    Fill in the lead generation form with accurate details

  • 2

    Get quote, make payment and receive the policy documents

How to Renew

  • 0

    Contact the Policy Issuing Office

  • 1

    Review expiring policy and share necessary details

  • 2

    Receive renewal quote

  • 3

    Make renewal payment

  • 4

    Receive the renewed policy documents via email

How to Claim

  • 0

    Contact us through our customer service touchpoints

  • 1

    Submit the claim form along with the necessary documents

  • 2

    Provide details of the incident and any supporting evidence

  • 3

    Cooperate with the claims investigation process

  • 4

    Receive the claim settlement as per the policy terms

Know More

  • 0

    For any further queries, please reach out to us

  • 1

    Toll Free : For Sales :1800-209-0144

  • 2

    Email ID: bagichelp@bajajallianz.co.in

Why Buy a Product Liability Insurance Policy Through Bajaj Allianz for Business?

Bajaj Allianz General Insurance Company offers a comprehensive Product Liability Insurance policy designed to safeguard your business from unexpected product-related risks. With an extensive range of coverage options, the policy ensures that your business remains protected against third-party claims for bodily injury, property damage and other product defects. Whether you manufacture goods, distribute, or sell them, the policy covers a wide array of industries, including retail, manufacturing, electronics, and more.

  • Tailored Coverage : Customise coverage to suit your specific business needs, ensuring that you have the right protection.
  • Affordable Premiums : With competitive premiums, the policy ensures that businesses of all sizes can access reliable coverage without overburdening their budgets.
  • Expert Support : Receive support from a team of experts to understand the policy and assist you with claims and legal matters.
  • Seamless Claims Process : Bajaj Allianz General Insurance Company ensures a hassle-free and transparent claims process to help your business recover swiftly.
  • Reputation and Trust : With a strong presence in the Indian insurance market, Bajaj Allianz General Insurance Company provides businesses with reliable, long-term protection backed by a trusted brand.

Protect your business and reputation with Bajaj Allianz’s Product Liability Insurance, providing you with the security you need to thrive in today’s competitive market.

How to File a Claim for Product Liability Insurance?

  • Notify Your Insurer : Immediately inform your insurer about the product-related incident or claim.
  • Provide Detailed Information : Submit all necessary documentation, including proof of purchase, product details, and any reports on the incident.
  • Cooperate with Investigations : Your insurer will investigate the claim. Cooperate by providing all required information, including accident reports or medical documents.
  • Follow Legal Advice : Seek legal counsel if necessary to guide you through the process of defending against claims.
  • Maintain Records : Keep detailed records of all communications with your insurer, along with receipts, invoices, and documentation related to the incident.
  • Timely Filing : File your claim as soon as possible after the incident to avoid delays in processing.
  • Claim Settlement : Once the claim is reviewed, your insurer will settle the claim by compensating for damages, legal expenses, and other costs covered by the policy.

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What Our Customers Say

Reliable Protection

Bajaj Allianz’s Erection All Risks Insurance gave us complete peace of mind during our project. The coverage was comprehensive, and their support was proactive at every step. 

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Rajesh Mehta

Pune

4.8

15th Mar 2025

Hassle-Free Claims

I was impressed by how quickly Bajaj Allianz processed my claim when we faced an unexpected mishap during the erection phase. 

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Ankita Sharma

Ahmedabad

4.7

10th Aug 2024

Excellent Coverage & Service

With Erection All Risks Insurance, we felt secure knowing that our project was well-protected. The policy covered all major risks, and the Bajaj Allianz team was always available for assistance. 

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Vikram Iyer

Bengaluru

4.9

22nd Jun 2025

FAQ

What is Product Liability Insurance?

Product Liability Insurance protects businesses from claims related to product defects that cause injury or damage. Whether you manufacture, distribute, or sell products, you could be held legally responsible if something goes wrong. This insurance helps cover legal expenses, medical costs, and compensation claims arising from faulty or unsafe products. It is essential for businesses to safeguard themselves against financial losses resulting from product-related lawsuits, recalls, or third-party damages.

Who needs Product Liability Insurance?

Any business that makes, sells, or distributes products—like manufacturers, retailers, wholesalers, or distributors—should have Product Liability Insurance. It protects against claims if a product causes injury or damage.

What does Product Liability Insurance cover?

Product Liability Insurance typically covers three main areas. First, it includes manufacturing defects, which are flaws that occur during the production process and make the product unsafe to use. Second, it covers design defects, where the product’s inherent design is dangerous, even if manufactured correctly. Lastly, it includes marketing defects, such as improper labeling, lack of safety warnings, or inadequate instructions that can lead to misuse and potential harm.

What are the exclusions under a Product Liability Insurance policy?

Common exclusions include, Intentional wrongdoing or fraud, Contractual liability, Product recalls, Wear and tear or gradual deterioration.

How much does Product Liability Insurance cost?

The cost of Product Liability Insurance varies based on several factors, including the type of products you sell, the size of your business, and your claim history. On average, a small business can expect to pay between $400 and $1,200 per year for coverage. Businesses dealing with high-risk products may face higher premiums.

What happens if I don’t have Product Liability Insurance?

Without Product Liability Insurance, your business faces significant financial risk. A single product-related lawsuit can lead to high legal fees and compensation costs, which could seriously impact or even shut down your business. This insurance provides essential protection against such unexpected liabilities.

Who Needs Product Liability Insurance?

Product Liability Insurance (PLI) is essential for businesses involved in manufacturing, distributing, or selling products. This includes manufacturers, retailers, wholesalers, contractors, food and beverage companies, cosmetic and pharmaceutical businesses and importers/exporters, all of whom face potential risks from defective products. General liability insurance can also help businesses protect against broader liabilities beyond just product-related claims. For businesses operating in sectors like shipping, marine liability insurance may be an additional consideration for handling risks associated with waterborne goods.

Is Product Liability Insurance Mandatory in India?

Product Liability Insurance is not legally mandatory in India. However, businesses dealing with products are strongly advised to have this coverage to protect against the financial and legal risks arising from product defects. For broader protection, companies may also consider general liability insurance coverage, which addresses a variety of liability risks, or even professional liability insurance for service-based industries.

What is Excluded Under This Policy?

Product Liability Insurance typically excludes claims arising from:

  • ● Intentional product defects or damages
  • ● Products not in compliance with safety standards
  • ● Product misuse or negligence by the consumer
  • ● Contractual liability not related to product defects
  • ● Damage caused by faulty installation or maintenance.

Additionally, liability insurance coverage may not apply to claims outside the scope of the agreed policy, such as public liability and professional indemnity insurance exclusions.

Can I Customise the Coverage with Add-Ons?

Yes, you can customise your Product Liability Insurance policy with add-ons like:

  • ● Product recall coverage
  • ● International coverage
  • ● Environmental damage protection
  • ● Legal expense cover

These add-ons can tailor your policy to meet your business's specific needs. For companies with a global presence, marine liability insurance can be an important add-on to cover overseas shipping risks, while businesses in the service sector may need professional liability insurance for added protection.

How is the Premium Calculated?

The premium for Product Liability Insurance is typically calculated based on:

  • ● Type of product or industry
  • ● Business turnover and sales volume
  • ● Risk associated with the product
  • ● Claims history
  • ● Geographical reach and market

Higher-risk products or sectors may attract higher premiums. If you're looking for broader coverage, you may also want to explore company liability insurance or public liability and professional indemnity insurance policies to ensure comprehensive protection.

What is the Principle of Product Liability?

The principle of Product Liability holds manufacturers, distributors, and retailers responsible for injuries or damage caused by defective products. It ensures that consumers are protected, and businesses are held accountable for the safety, quality, and performance of the products they sell. General liability insurance and professional liability insurance are both valuable policies for businesses looking to protect against various forms of liability risk in addition to product-related claims.

How much liability coverage should I purchase?

The amount depends on your business size, industry risks, and contractual obligations. Assess potential lawsuit costs, client expectations, and industry standards. A higher coverage limit protects against costly claims, preventing financial losses.

Can liability insurance cover employees’ mistakes?

Yes, professional liability insurance covers errors employees make while performing work duties. If a client sues over financial loss due to an employee’s mistake, the policy covers legal expenses, settlements, and claims. However, intentional wrongdoing or fraudulent actions are typically excluded from coverage.

Does liability insurance cover cyber-related risks?

Standard liability insurance does not cover cyber risks like data breaches or hacking incidents. Businesses handling sensitive customer data need cyber liability insurance. This policy covers legal fees, customer notification costs, regulatory fines, and recovery expenses.

What’s the difference between occurrence-based & claims-made policies?

Occurrence-based policies cover claims from incidents during the policy period, even if reported later. Claims-made policies cover only claims reported during the policy’s active term.

How is liability insurance different from other business insurances?

Liability insurance specifically covers claims from third parties for injuries, damages, or negligence. Unlike property insurance, which protects assets, or workers’ compensation, which covers employee injuries, liability insurance focuses on legal claims from external individuals or businesses against you.

How do I file a liability insurance claim?

To file a liability insurance claim, notify your insurer immediately, provide details about the incident, gather evidence such as photos or witness statements, and complete the claim form. The insurer will investigate, assess the damages, and determine coverage eligibility before processing the settlement based on policy terms.

Can a liability claim be denied?

Yes, a liability claim can be denied if the policyholder is found not liable, the incident is excluded from coverage, there’s insufficient evidence, or the claim is fraudulent. Reviewing the policy terms and providing accurate documentation can help avoid unnecessary claim rejections.

How does a liability claim affect my insurance premium?

A liability claim may increase your insurance premium, as insurers assess risk based on claim history. Multiple claims or high-value payouts can label you as a higher risk, leading to higher renewal costs.

How long does it take to settle a liability claim?

The time to settle a liability insurance claim varies based on its complexity, documentation, and insurer policies.

What should I do if my claim is denied?

If your liability claim is denied, review the denial letter and policy terms to understand the reason. You can appeal by providing additional evidence.

When should I renew my liability insurance policy?

You should renew your liability insurance before expiration to avoid coverage gaps. Most insurers send renewal notifications a few days before expiration. Reviewing your policy early allows time for adjustments if needed.

How do I check my liability insurance renewal date?

You can find your renewal date on your policy documents, your insurer’s website, or their mobile app. Most insurers also send renewal reminders through email, SMS, or postal mail. If you're still unsure, it's best to contact your insurance provider or agent directly to confirm the renewal details.

Can I switch insurers while renewing my liability insurance?

Yes, you can switch insurers at renewal if you find a better policy. Compare coverage, premiums, exclusions, and customer service before switching.

What documents are needed for liability insurance renewal?

Insurers typically require your current policy details, claim history, updated business information, and financial records. Some may request risk assessment reports or compliance documents.

Are there discounts available when renewing liability insurance?

Yes, insurers offer discounts for claim-free records, risk management measures, bundling policies, and long-term loyalty. Some also provide reduced rates for businesses with strong safety protocols or low-risk profiles.

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