Products Liability Insurance: following the risk through the supply chain 

Responsibility for products doesn’t end at manufacture. Brokers play a key role in helping underwriters understand how products move through the supply chain and into use.

What this class covers

Products Liability covers liability from injury or damage caused by goods supplied, manufactured, or sold by a business.

Importantly, liability can extend beyond manufacturers to distributors and suppliers within the chain.

Why it matters

A common misconception is that only manufacturers carry products exposure. In reality, even a business that did not make a product can be held responsible for a defect, or for the damage or injury that a product causes. A faulty piece of equipment that catches fire and damages a customer's property could lead to a claim against the manufacturer or the supplier. That breadth is exactly why the cover deserves careful attention, particularly for businesses that distribute, import, or rebrand goods. It also explains why products exposure rarely stands alone. It often sits alongside other liability covers within a single operation, which is where a joined-up underwriting approach becomes valuable. A business supplying specialist equipment, for example, may carry both public and products exposures that need to be considered together. The principle that runs through our approach is the same one we apply across the team: engaging with the detail of how a product is made, supplied, and used, rather than assessing it in isolation.

What shapes the risk

The product itself, the supply chain around it, and its end use together define the risk. A component sold into a low-risk application carries a different profile to one used in a safety-critical environment. Quality control and testing processes matter, as do the territories into which products are sold, since legal environments vary. Helping underwriters see the full journey of a product supports a more accurate assessment. 

How the AXIS Global Market Liability team approaches challenging or non-standard risks

We approach Products Liability with a focus on understanding the broader context of the product’s use.

Where a product risk has non-standard exposures, we look for a thoughtful solution rather than a default decline. We have the flexibility to consider risks at the edge of conventional appetite, and we will often co-insure with other markets so that the insured has the correct coverage and limits in place. Where a risk benefits from a combined approach across our capabilities, we will look to bring those together. The aim is always to find a structure that keeps within our underwriting discipline while giving the broker and insured a genuine option.

Broker reference points

For Product Liability, useful information often includes: 

• Product type and key characteristics
• Customer’s role within the supply chain (manufacturer, distributor, supplier)
• End use and environment in which the product is deployed 
• Quality control and testing procedures 
• Any relevant certifications or standards
• Geographic origin and distribution of products
• Claims history and known defect issues

These details help our underwriters trace the risk through the supply chain and respond efficiently.

Closing

Products Liability is as much about context as it is about the product itself. Our underwriters are always available to talk a risk through and consider structure and placement options, including combined approaches where they add value.  

This article is for general information purposes only and does not constitute insurance, legal or risk management advice. Coverage is subject to applicable policy terms, conditions, limits and exclusions.