Defective and unsafe products cause nearly 30 million injuries every year. Each of those injuries represents a massive liability for the company that caused it. That’s why, for your business safety, it’s important to understand the major kinds of defective product liability risks your face.
We put together this article to make that clearer. Keep reading to learn more.
Three Types of Defective Product Liability Claims
There are three major kinds of defective product liability claims that your company may face:
- Defective manufacture
- Defective design
- Failure to provide adequate warnings or instructions
We’ll cover what each of those looks like below.
Defective manufacturing is what most people think about when they imagine defective product liability. However, it can encompass any defect that occurs as a result of the manufacturing process.
For example, a machine used in your manufacturing process may malfunction and create a line of products that aren’t strong enough to withstand normal use.
Or an employee may make a mistake while putting together a product that causes it to fall apart dangerously.
Anything that goes wrong with the manufacturing process and leads to a defective product will fit into this category.
It’s also possible that your manufacturing process goes exactly as planned, but the products that it creates are still defective. When this happens, it’s often a sign that you have a defective design.
For example, you might create a car that’s prone to engine overheating, which causes it to catch fire. Or a sunscreen producer could create a line of products that don’t actually offer as much UV protection as they say they do.
The idea behind this liability category is that the product’s design is flawed. So even if everything in manufacturing goes perfectly, you still end up getting faulty products.
Failure to Provide Adequate Warnings or Instructions
Some categories of products require special warnings and instructions.
For example, medication typically needs to include a list of side effects that can occur or things that it shouldn’t be taken in combination with.
Or maybe you create cooking utensils that can burn people if they don’t use them properly, but you fail to clarify what proper use entails.
Under this type of claim, you can still be held liable even if your product does everything that it’s supposed to. The issue isn’t within the product itself but in the warnings and instructions that you fail to include with it.
Protecting Your Business From Defective Product Liability
In recent years, there have been multiple cases of defective product liability charges eclipsing $1 billion. That’s why it’s so important to be proactive about protecting your business from these issues.
If you don’t have the right plan in place, the financial charges you incur resulting from a defective product could literally bankrupt your business. With that in mind, here are three steps that you can take now to ensure that a chance defective product doesn’t kill your company.
Get the Right Insurance
Perhaps the best thing you can do to minimize your risk is to find the right insurance plan. For example, a product liability plan can provide you with coverage in the event that you face charges resulting from a defective product.
For example, your insurance plan can help out with the costs of:
- Attorney fees
- Legal judgments in civil court
- Medical costs resulting from product defects
- And more
It’s impossible to keep your business 100% protected against every potential scenario that can lead to a product defect. But with an insurance plan in place, your financial losses won’t be nearly as severe if the worst happens.
Implement Stringent Safety Practices
Product defects can and often do occur when they’re least expected. But if you have excellent safety practices in place, you can avoid a lot of the potential reasons why they may occur.
For example, you could institute a second round of product quality checks before you send a batch of goods out onto the market. You might want to invest in a new kind of testing as well. Or perhaps you’ll provide more in-depth instructions to your employees so that they make fewer mistakes.
However you do it, the key to this step is identifying what can cause a product defect to occur and then taking preventative action to reduce that risk.
Find a Good Attorney
Finally, a good lawyer can do a lot to help you minimize the impact of a product defect. They can advise you on the best steps to take when one occurs and inform you of the legal obligations you have regarding instructions and safety warnings for different types of products.
Plus, if you start a relationship with an attorney now, you’ll be able to respond to a product defective in a legally responsible way more efficiently when one occurs.