A Guide to Buying Manufacturing Insurance
Factories, warehouses and the production line can be a busy and exciting place to work, however with all the activity, it’s all too easy for an accident to happen. With the HSE reporting that 20% of all workplace claims occur with the Manufacturing Industry, it is essential that you have adequate Manufacturing Insurance in place.
What type of Manufacturer are you?
The Manufacturing Industry is often associated with large factories and dirty equipment, yet you don’t have to work with huge machinery to be considered a manufacturer, and you don’t have to have to make heavy equipment for an injury to occur. Food Manufacturers accounted for the highest workplace major injuries within the Manufacturing sector last year.
If you produce anything and sell it on, then you are a manufacturer This could be anything from mechanical car parts, food products or more local to our office near Sheffield, Steel products like cutlery. You can also be considered a Manufacturer if you important and distribute manufactured goods from overseas like plastic components for toys.
There are many types of manufacturing industries so it’s important that you know which category you fall into when taking out Manufacturer Insurance.
What Does Manufacturing Insurance Cover?
Manufacturing Insurance can be arranged to cover every aspect of your business from the building, to staff to the products that you make or distribute. Levels of cover can vary and policies can be arranged to include cover for a range of perils.
Employers Liability Insurance – This a requirement by UK law with a minimum of £5 million if you have anyone under your employment whether full time or casual volunteers. This will provide cover for you should an employee have an accident in the workplace or suffer an illness as a direct result of working for you. The Manufacturing Industry accounted for over 2000 cancer deaths as a result of being exposed to harmful radiation at work last year and 10% of all workplace deaths were on a factory floor. Liability claims can be costly and time consuming and are always a threat within manufacturing.
Vehicle Insurance – If you drive a vehicle, or use vehicles in line with your work then you need a specialist policy as your regular motor insurance policy will not cover driving for work. A common misconception among motorists that is only realised once they make a claim. If you have more than 3 vehicles then a Motor Fleet Policy can be a cost effective way of insuring all your vehicles under one policy.
Just because a type of cover isn’t required by law doesn’t make it any less necessary for running a successful business. Other types of cover that a Manufacturing Manager should consider are:
Product Liability – This will cover anything that you make and distribute in the event that it happens to be faulty. This can not only cover the costs of replacement but also the repair work that may have to be done if the component that you’ve supplied damages the property of a third party or even their injury to themselves.
Public Liability – Public Liability should be seen as essential if you have customers or members of the public, including inspectors, visit you at work. A factory floor can be extremely hazardous, especially if they are not trained or knowledgeable of their surroundings. PL Insurance can protect you against the risks you face of having non employees in your work space.
Tools and Equipment Insurance – The machinery you use to carry out your work is as important as the people who run them. Tools are often overlooked yet can have extremely high monetary value and are often collected over years of working. If all your tools and equipment were to be stolen or damaged, could you afford to replace all of them over night and go back to work the next day? It’s important to have all aspects of your business insured, especially your tools.
Transportation Insurance – You need to ensure that your stock is covered from the minute you create it until it’s reached the doorstep of the buyer. Transportation Insurance will protect your stock while it is in transit so if it gets stolen or damaged in an accident you haven’t put your man hours to waste. If your stock were to be damaged after you’d invested in making it, you could suffer from income loss but still have your regular expenditure.
Business Interruption Insurance – If for any reason your business cannot carry out operations as usual, Business Interruption Insurance can help cover the costs of fixed overheads like rent or wages while your income has temporarily stopped.
If you are unsure about what type of insurance you need for your Manufacturing Business, call a member of our team on 01246 575 625 for professional and friendly advice.
If you important and distribute goods that are manufactured from outside the UK it is essential that you understand the difference in Manufacturing Standards around the world and how these apply to your companies. For example, if you are manufacturing cosmetics, the list of approved ingredients in the UK is a lot stricter than that in China. Measuring standards differ from the USA to the UK and the rules and regulations about Food Manufacturing are even more complex.
For a full list of Manufacturing Standards for the UK, you can visit the UK .Gov website here to make sure that you meet regulations.
Duty of Care
A vast majority of claims made against Manufacturers are from customers who believe that the supplier has been negligent, however there are ways to reduce this:
- Regularly test products to ensure that they are working as expected
- Supply a comprehensive manual with your product in correct translations for the countries that you supply too.
- Ensure that all products meet regulations such as the CE mark for the EU. You can read more about that here.
- Ensure regular staff training so all team members are aware of the exact specifications of products that they are manufacturing.
- Have a designated customer service line so that help can be issued as soon as possible to an unsatisfied customer.
If you have any questions about Manufacturing Business Insurance then don’t hesitate to contact us here or call us on 01246 575 625 to discuss your requirements with our team of professional, efficient and friendly advisers.