As digital and physical processes continue to converge, manufacturers are modernising their production methods, enhancing their products, and changing the way they service and support their customers.
These changes present an array of new risks that manufacturers may not be adequately protected against through a traditional General Liability policy.
Gaps in General Liability Coverage
Claims arising out of damage to and/or loss of use of intangible property are not covered
No cover unless the manufacturing defect results in bodily injury or property damage
At Chubb, we are committed to serve manufacturers and ensure they are adequately protected from the risks associated with actual or alleged product or service defects, deficiencies, inadequacies or dangerous conditions. That’s why we developed a simple, standardised endorsement which adds Errors or Omissions liability insurance to a manufacturer’s General Liability policy with a focus on ease of business.
Errors or Omissions (E&O) insurance plays a critical part in protecting a manufacturer’s balance sheet by responding on a manufacturer’s behalf to third-party claims alleging financial or economic injury.
It is offered as part of Chubb Assembly, a solution which offers scalable insurance enhancements and modular, liability-driven insurance solutions, specifically for the manufacturing industry.
Dedicated limit of insurance for E&O, available from as low as USD100,000
Encompass the full scope of insured Products and Services
Claims Made coverage trigger
Insurance written specifically with the needs of Manufacturing companies in mind
Pays on behalf of the policyholder (vs reimbursing)
Deductibles available as low as USD100,000
While a combined General Liability and Errors & Omissions insurance program will respond to a broad array of exposures, manufacturers should also be sure to understand how other key products fit in:
Protects against legal liability and expenses incurred as a result of acts such as a failure of network security or unauthorised access or disclosure.
Generally not meant to provide coverage for economic injuries arising out of products and services.
Product Recall Expense Insurance
Costs associated with the recall of products that are defective, dangerous, harmful or adulterated pose a substantial risk that can expose a manufacturer’s balance sheet.
These are costs that are not typically addressed on a GL, E&O, or Cyber policy.
Integrated “Solution Provider”
A claim was made by a shipping company against a manufacturer of an integrated temperature monitoring “solution” used to monitor the temperature of cargo while in-transit. The shipper alleged that the in-transit temperature monitoring “solution” did not accurately record temperatures at established intervals, thereby leading to a wholesale grocery distributor rejecting a load of perishable goods.
Manufacturer of Conveyor Systems
Several large distributors filed claims against a manufacturer of conveyor systems, alleging that such systems were defective, resulting in additional costs, late deliveries and lost income.
Contract Terminated due to Supplier’s Error
A claim for compensation is made against a manufacturer of custom bolts by a farm equipment manufacturer for their failure to fulfil a client’s contract. A raw material supplied to the bolt manufacturer by a third party was found to be defective, rendering the bolts unsafe. The farm equipment manufacturer couldn’t use the bolts and terminated the supply contract with the bolt manufacturer.
A claim is made against a machinery manufacturer for loss of production time during a processing line outage. The machinery manufacturer was performing a routine maintenance visit for a product sold to their client. Whilst modifying the equipment, it resulted in slower than expected production speeds and subsequently lower output capacity.
Please refer to the policy contract for the full details of benefits, terms and exclusions that are applicable. The information provided here is a brief summary for quick and easy reference. The exact terms and conditions that apply are stated in the policy contract.
To help manufacturers close gaps typically inherent in traditional insurance programs, Chubb has introduced Chubb Assembly, an industry vertical solution which offers scalable insurance enhancements and modular, liability-driven insurance solutions.