- For manufacturers, distributors & retailers
- Coverage for design, manufacturing & warning defects
Product Liability Insurance
Make it, distribute it, or sell it. You can be sued for it.
Product liability insurance covers claims that a physical product caused bodily injury or property damage to the people who used it. Any business in the chain (manufacturer, distributor, importer, or retailer) can be named in the same lawsuit.
- Covers design defects, manufacturing defects, and failure to warn
- Defends claims even when your product was used as intended
- Available as part of GL or as a standalone policy for higher-risk products
- Often required by retailers, distributors, and marketplaces
📦 Request your free product liability review
Tell us about your products and operations. A licensed Texas advisor follows up. No obligation.
Trusted by Texas product businesses since 1983
Product placements since 1983
GL or standalone product policies
Including specialty product markets
Food, cosmetics, imports welcome
The chain of product liability
When a product harms someone, the claim can land on every link in the chain.
A consumer who is harmed by a product can typically sue any party involved in bringing that product to market, not just the manufacturer. Product liability insurance is built around this reality, and it’s why retailers, distributors, and importers often need their own coverage even when they didn’t make the product.
Manufacturer
Designs, manufactures, or assembles the product. Faces strict liability in many states for defects.
- Strictly liable for defects
Distributor / Wholesaler
Moves the product through the supply chain. Often named alongside the manufacturer in suits.
- May be named in claims
Retailer / Seller
Sells the product to the end customer. Frequently the first party a consumer sues.
- First point of contact
Consumer / User
Uses the product and is harmed by an alleged defect. Files the claim against parties up the chain.
- Origin of the claim
Texas innocent seller defense.
Texas law (Chapter 82 of the Civil Practice and Remedies Code) provides important protections for non-manufacturing sellers in product liability cases, with specific conditions and exceptions. In general, sellers who didn’t design, manufacture, modify, or have actual knowledge of a defect may have certain defenses available. This is a meaningful protection that varies by state, but the specifics for your situation should be reviewed with a Texas attorney. From the insurance side, we help retailers and distributors get the right coverage for the exposures Chapter 82 doesn’t eliminate.
The takeaway: if you’re anywhere in the chain of a physical product reaching consumers, you have product liability exposure. Even when you didn’t make it, you can be sued for it, and the cost of defending the claim is real regardless of the outcome.
The three types of product defects
What product liability claims actually allege.
Most product liability lawsuits fall into one of three categories of alleged defect. Each one has different evidence, different defenses, and different implications for how a claim is handled.
Design defects
The product was designed in a way that’s inherently unsafe, even when manufactured correctly. The argument: a safer alternative design was feasible.
Manufacturing defects
The design is sound, but something went wrong in production. A specific unit (or batch) deviated from the intended design and caused harm.
Failure to warn
The product itself is fine when used correctly, but the warnings, instructions, or labeling failed to alert users to known risks of foreseeable misuse.
Bodily injury claims
Most product liability claims involve injury to a person, sometimes serious or fatal. Defense costs and settlements can run high quickly.
Property damage
A product damages other property (a defective appliance starts a fire, a failed component damages a vehicle). These claims are also covered.
Defense costs
Product liability cases are expensive to defend. Expert witnesses, product testing, and discovery often run six figures even for routine claims.
What product liability covers, and what it doesn't
The most important "not covered": product recall.
Standard product liability insurance covers third-party claims for bodily injury and property damage caused by your products. It generally does not cover the cost of recalling a product from the market (logistics, customer refunds, replacement product, and PR). That’s a separate coverage called product recall insurance, and it’s increasingly important for food, beverage, cosmetics, electronics, and consumer goods.
Many GL policies include products and completed operations coverage as part of the base form. For higher-risk products, larger revenues, or specific industries, standalone product liability or excess coverage may be needed.
Personal injuries allegedly caused by your product, foreseeable misuse, or warnings failure.
Damage to property other than your own product caused by your product.
Attorney fees, expert witnesses, and court costs in defending product claims.
Claims arising after the product has left your control and reached the consumer.
Recall costs, your own product's failure, regulatory fines, intentional acts.
Pure economic loss without bodily injury or property damage to other property.
Who needs product liability
Any business that touches a physical product.
Manufacturers face the strongest exposure, but distributors, importers, and retailers all face product claims too. Certain product categories (food, cosmetics, electronics, durable goods) carry elevated risk and often require specialty placement.
Manufacturers
The first link in the chain. Strict liability applies in many cases, and defense costs run high.
Distributors & importers
Importers of foreign products take on manufacturer-like exposure in many cases.
Retailers (especially private label)
Private label puts your brand on the product, often elevating you to manufacturer-level exposure.
Food, beverage & cosmetics
Higher injury severity and recall risk, often requiring specialty markets and dedicated coverage.
Why work with Aimbest
Product placements have nuances most brokers miss.
Standard GL coverage with products and completed operations may be enough for some businesses, but plenty of others need specialty markets, dedicated product policies, or excess product liability stacked above GL. Importer exposures, private label arrangements, and recall coverage all need to be addressed deliberately. After more than four decades, we know what to ask and where to place.
We’ll tell you whether your GL’s products coverage is genuinely adequate or just labeled “products.
Importers and private label retailers face different exposures. We structure for both.
Standalone product recall insurance for businesses where recall risk is real.
"We import consumer electronics, and our previous broker had us on a GL with a tiny products sub-limit. Aimbest rebuilt the program with proper product limits and a recall policy on top."
"Our wholesale importing business requires reliable insurance that can keep up with our growth. Aimbest took the time to understand our operations and designed a policy that provides the protection we need. Their professionalism and attention to detail have made them a trusted partner."
"Managing a distribution business comes with unique challenges, and insurance is a critical part of protecting our operations. Aimbest developed a customized coverage plan that addressed our specific risks and gave us confidence in our long-term security. Their team was knowledgeable, efficient, and easy to work with."
How it works
From first call to covered business, four steps.
Share your products, your role in the chain, and current coverage. A licensed advisor follows up.
We review your products, sales volume, distribution channels, and current GL or product coverage.
GL with adequate product limits, standalone product liability, or excess. Plus recall, if relevant.
Bind the policy and keep a Texas advisor for renewals, claims, and contract requirements.
Common questions
Product liability, answered.
Doesn't my GL already include product liability?
Most General Liability policies include “products and completed operations” coverage as part of the standard form, and for many businesses with modest product exposure that’s enough. However, the limits may be inadequate for higher-volume product sales, certain product categories may be excluded or sub-limited, and importers and private label retailers often have exposures that go beyond what a basic GL provides. We review your GL form carefully and tell you honestly whether it’s right-sized for your products.
What's the Texas innocent seller defense?
Texas Civil Practice and Remedies Code Chapter 82 provides certain protections for non-manufacturing sellers in product liability cases. In general, sellers who didn’t design, manufacture, or modify the product, and who lacked actual knowledge of a defect, may have specific defenses available, with various conditions and exceptions. This is one of the more favorable seller protections in the United States, but the specifics of how Chapter 82 applies to your situation should be reviewed with a Texas attorney. From the insurance side, the law doesn’t eliminate the cost of defending a claim or the need for coverage.
Does product liability cover product recall costs?
Generally, no. Standard product liability covers third-party claims for bodily injury and property damage. The cost of recalling the product itself, including reaching customers, retrieving inventory, replacement product, refunds, and PR costs, is typically excluded. That’s a separate coverage called product recall insurance, and it’s increasingly important for food, beverage, cosmetics, electronics, and any consumer goods category where recalls are common. We can place recall coverage alongside your product liability when the exposure justifies it.
I just import and resell products. Do I really need this?
Yes, often more than you’d think. Importers of products manufactured outside the United States are frequently treated as manufacturers for liability purposes, because the original manufacturer is harder to reach. Even pure resellers can be named in product lawsuits and face significant defense costs. The Texas innocent seller defense may provide some protection in certain circumstances, but it doesn’t eliminate the need for coverage. We help importers and resellers right-size their product programs.
How long after a sale can a product claim be filed?
Product liability claims can be filed years after the original sale, depending on when the alleged harm occurred and various legal time limits. Texas has a general statute of repose for products, but its application depends on the type of product and case specifics, and there are exceptions. This is why completed operations and ongoing coverage continuity matter so much in product placements. Specific time limits for your situation should be confirmed with a Texas attorney.
Can you help if my product was just declined by a standard carrier?
Often, yes. Standard carriers tighten appetite around certain product categories (food, dietary supplements, cosmetics, electronics, anything with elevated injury or recall risk), and specialty markets exist specifically for these placements. Send us the decline letter, your product details, and any current loss runs you have, and we’ll show you what’s available.
Related coverage
What pairs with product liability.
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Let's make sure your product coverage is genuinely sized for what you sell.
Request a free, no-obligation product liability review. We’ll explain GL vs. standalone, recall coverage, and import exposures in plain language.