Whatever you manufacture, protect your business with manufacturing insurance.
Manufacturing Insurance
As a manufacturer in the oil and gas industry, it is crucial to protect your business from potential risks that could arise from production-related activities. These include accidents, equipment malfunction, and natural disasters, among others. The best way to safeguard your enterprise from such threats is to invest in manufacturing insurance. In this blog post, we will discuss why raw materials manufacturing insurance is essential for your business and how it can help keep your operations running smoothly.
Whatever you manufacture, protect your business with manufacturing insurance from American Energy Insurance (AEI)!
Coverage Every Manufacturer Needs
Finding the right insurance policies to protect your manufacturing business can be a daunting task. That’s why it’s essential to find a reliable insurance partner who understands the industry’s unique needs and can help tailor coverage that protects your business in every way possible.
Keep in mind the coverage that every manufacturer needs, which American Energy Insurance provides.
There are certain coverage options in your manufacturing insurance policy that are beneficial for most businesses in the industry. They may protect your business from the unexpected risks you face on a day-to-day basis, whether it’s the production of the products, or shipment of them.
American Energy Insurance Covers:
- Business Auto
- Business Interruption
- Commercial Property
- Employers Liability
- Errors and Omissions
- General Liability
- Manufacturers’ Selling Price
- Motor Truck Cargo
- Ocean Cargo
- Product Recall
- Workers’ Compensation
Interactive Graphic
Commercial General Liability Insurance
Risk Factor
The manufacturing business is unique and comes with many exposures, which can lead to a potential lawsuit. What if a fire breaks out and damages the building and halts production, causing you to default on your delivery contracts? Would your business survive?
Solution
Commercial general liability insurance is an absolute necessity for a manufacturing business. This type of protection provides broad coverage for premises, operations, completed operations and advertising, and personal injury. It will also pay to defend any covered lawsuit or action regardless of its merit. Coverage can be purchased as a separate policy and can be tailored to your specific needs.
Commercial Property Insurance
Risk Factor
When a gas tank explosion causes an uncontrollable fire, your commercial property and everything within it can suffer a significant loss. This can have a detrimental effect on your manufacturing business.
Solution
Commercial property insurance can help protect the property your business owns or leases, including things like equipment, inventory, furniture, and fixtures. Whether you own your building or lease your workspace, commercial property insurance can be purchased separately or can be combined with other necessary coverage to protect your business’ physical assets.
Business Interruption Insurance
Risk Factor
What would you do if a fire impacted the operation of your production line and prevented you from serving clients for a day or more? Or what if a pipe leak caused a system outage or extended downtime, leaving your production line inoperable? These and other events can destroy your ability to serve clients and bring in revenue, which can have a major long-term impact on the viability of your business.
Solution
Business interruption insurance compensates you for lost income if your manufacturing facility cannot operate as normal due to damage that is covered under your commercial property insurance policy, such as fire or water damage. Business interruption insurance covers the revenue you would have earned, based on your financial records, had the incident not occurred. The policy also covers operating expenses, like electricity, that continue even though business activities have come to a temporary halt.
Product Recall Insurance
Risk Factor
When a product you manufacture is found to be defective and causes bodily injury or property damage to others, you may be held financially liable. Product recalls can be involuntary (required by a regulatory agency or the government) or voluntary (the manufacturer notices a defect that is unlikely to force an involuntary recall), and can be costly.
Solution
Product recall insurance covers expenses associated with recalling a product from the market. Coverage can include customer notification costs, shipping costs, and disposal costs. Coverage generally applies to the manufacturing business itself, though additional coverage can be purchased to cover the costs of third parties.
Workers’ Compensation
Risk Factor
If one of your employees receives an injury or becomes ill due to a work-related occurrence, you are required by law to have the proper coverage in place.
Solution
Workers' compensation protects your employees should a job-related injury or sickness occur during the course of employment. This coverage is required by law and may vary by area, so be sure that you understand your obligations for all physical locations where your business operates in and all physical locations where you hire your employees.
Business Auto Insurance
Risk Factor
As a manufacturing business, you have many exposures associated with your business vehicles–owned or leased. With a fleet of cars, trucks, vans, or other types of vehicles used in the course of business, a single accident can potentially put your business in financial jeopardy.
Solution
Business auto insurance provides coverage for vehicles owned or leased by your manufacturing business and provides coverage for bodily injury, property damage, and other exposures, and could include comprehensive and collision coverage as well.
Commercial Umbrella / Excess Liability
Risk Factor
Losses and lawsuits are quite common in the manufacturing business, and settlements can be substantial. If your business is found to be responsible for damage or injury, you could be facing a large liability loss that exceeds the basic limits of your standard policy.
Solution
You should consider purchasing a commercial umbrella insurance policy which provides higher limits, typically between $2,000,000 and $10,000,000, and often broadened coverages. Coverage is extended over various policies, including general liability insurance, business auto, and directors and officers liability insurance.
Motor Truck and Ocean Cargo Insurance
Risk Factor
As a manufacturer, you’re constantly shipping your cargo around the world either by land, air, or sea, which exposes your business to risk as a result of product loss, theft, or damage.
Solution
You can purchase ocean marine insurance for your products while your shipments of goods are in transit, whether it's by truck, rail, air, ship, or boat, and until they reach their final destination.
Comprehensive Manufacturing Insurance
Property Damage
One of the most significant risks for manufacturers is damage to their property caused by natural disasters, accidents, or criminal activity. In addition to the physical damage, your operations may be interrupted, leading to a loss of revenue and productivity. This damage can result in costly repairs that can affect your business’s productivity. By investing in manufacturing insurance, you can protect your property from such risks and have the assurance that you will be compensated for any damage that may occur.
American Energy Insurance offers manufacturing insurance that includes property damage coverage that can help you repair or replace damaged property. Moreover, it covers the costs of lost revenue and extra expenses incurred during the disruption of your operations.
Liability Coverage
Another risk for oil and gas industry manufacturers is liability. Your business may be held responsible for damages or injuries caused by your products, operations, or employees. AEI’s manufacturer insurance includes liability coverage that protects you against lawsuits and damages. This coverage includes product liability, which covers damages caused by your products, and general liability, which covers damages caused by your operations or employees.
Accidents that happen within your facility can put your business at risk of potential lawsuits from parties that may have been affected. Manufacturing insurance provides liability coverage, which compensates for damages and legal expenses resulting from lawsuits that your business may face.
Workers’ Compensation Coverage
As an employer, you have a responsibility to provide a safe and healthy workplace for your employees. However, accidents and illnesses may still happen, leading to injuries, medical expenses, and lost wages. AEI’s manufacturing insurance includes workers’ compensation coverage that protects your employees and your business. This coverage pays for medical expenses, lost wages, and other costs associated with workplace injuries or illnesses.
Risk Management Services
In addition to insurance coverage, AEI also provides risk management services designed to help you identify and mitigate potential risks. These services include loss prevention, safety training, and claims management. By working with AEI’s experts, you can improve your operations, reduce your risks, and protect your business.
Protection From Accidents
Manufacturers in the oil and gas industry are at high risk of accidents, such as explosions and fires, which can cause significant damage to property and equipment. These incidents could also result in injuries to workers, which can lead to medical costs and legal suits. Manufacturing insurance provides coverage against such risks, ensuring that you are protected in case of accidents caused by production activities in your facility.
Equipment Protection
Your business’s machinery is a valuable asset that needs protection from damage caused by incidents like breakdowns or malfunctions. Manufacturer insurance covers the repair and replacement costs of equipment that has been affected by such events, giving you peace of mind that your production will not be disrupted due to equipment failure.
Business Interruption Coverage
When unexpected events occur, your business may need to shut down temporarily, leading to loss of revenue and production. Manufacturing insurance covers the costs of downtime due to covered occurrences, ensuring that your business operations can resume without significant financial losses.
Protect the Products You Make and Distribute
As a manufacturer, your products are your most valuable asset because they are the reason why your business exists. Therefore, protecting them should be a top priority. Manufacturing insurance provides protection against damage to the products you distribute, loss of inventory due to theft, fire and other unforeseen circumstances. Standard business insurance might not be enough for your manufactured products.
A dedicated manufacturer insurance policy may cover the specific risks you face, leaving you free to concentrate on your business. By having such coverage, you can avoid the risks of losing income, and if something does go wrong, you’ll be able to replace your products quickly.
What is a Manufacturers’ Selling Price?
If your stock is damaged or destroyed by a covered event, you may get a payout reflecting the price you would have sold the items for—not the price you paid for the raw materials.
Damage to your products can affect your production line and ultimately affect the manufacturer’s selling price. When a product is compromised, it may no longer be fit for sale to your customers, which can cause a drop in your business’s reputation, and subsequently, its price. Manufacturing insurance provides coverage to help you recover losses associated with this kind of event.
The Benefits of Errors and Omissions Liability Coverage
Errors and omissions liability coverage goes beyond the usual business insurance that protects you against claims of property damage and injury caused by your products. It adds coverage for claims of financial losses. For example, if your customers say their business was hurt by a fault in your product, your coverage may help protect you from that claim.
Even the most experienced and skilled manufacturers make mistakes. Some of these mistakes can cause damage outside the manufacturing world. In such cases, claims against the manufacturer can result in legal battles and hefty settlements. Besides protecting you from such claims, errors and omissions coverage also protects your business against negligence claims and malpractices.
Prepare for Potential Product Recalls
Also consider product recall insurance, which kicks in if you’re forced to recall a product because it might cause harm. This insurance covers not only the costs of getting the product back to you but also safely disposing of the stock. Some policies may even cover legal costs or public relations expenses.
Product recalls can be expensive and damaging to your business, especially if they arise due to manufacturing or product testing glitches. American Energy Insurance offers endorsements that cover the costs of recalls. This is a proactive approach designed to help manufacturers stay in business and maintain profitability even after a recall.
Stay Ahead of the Competition
Investing in manufacturing insurance can help your business stay ahead of its competition. Your business and clients will appreciate the fact that you are covered and will recover losses if anything should go wrong. By having the right cover in place, you will gain a competitive advantage over companies that don’t invest in manufacturer insurance.
American Energy Insurance Can Safeguard Your Business
As a manufacturer in the oil and gas industry, investing in manufacturing insurance is an essential step in safeguarding your business’s productivity and profitability. The coverage provides protection from accidents, equipment damage, property damage, and liability risks, helping you avoid significant financial losses. At American Energy Insurance, we understand the unique risks facing your business and offer tailored insurance solutions that meet your specific needs. Request a quote or call 918-987-9229 to learn how we can help keep your business producing with manufacturer insurance!
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