Product Liability Insurance Explained

Shawn Plummer, CRPC

Chartered Retirement Planning Counselor

What is Product Liability Insurance?


Product liability insurance protects businesses against claims of personal injury or property damage caused by products sold or supplied through their business.


  • Injury or Damage Claims: Costs from lawsuits due to injury/damage caused by a product.
  • Legal Defense Fees: Covers attorney fees, court costs, and settlements.
  • Faulty Products: Includes products that are defective or have inadequate instructions/warnings.
Product Liability Insurance

How Much Does Product Liability Insurance Cost?

Factors Affecting Cost

  1. Type of Product: High-risk products (like electronics and food) cost more to insure.
  2. Sales Volume: Higher sales typically lead to higher premiums.
  3. Business Size: Larger businesses often pay more due to increased exposure.
  4. Claims History: A history of claims can increase premiums.

Average Cost

  • Small to Medium Businesses: Typically ranges from $400 to $1,800 per year.
  • High-Risk Products: Can exceed several thousand dollars annually.


  1. Small Craft Business: Lower risk, might pay around $500 per year.
  2. Electronics Manufacturer: Higher risk, could pay $5,000 or more per year.

Steps to Get Product Liability Insurance

  1. Evaluate Your Risk: Consider the type of products and associated risks.
  2. Get Quotes: Use The Annuity Expert’s insurance marketplace to compare quotes that fit your needs
  3. Review Coverage Details: Ensure the policy covers all potential risks.
  4. Consider Product Testing: Regular product testing can reduce insurance costs.


Product liability insurance is crucial for businesses to protect against claims related to their products. The cost varies widely depending on factors like product type, sales volume, and business size. Evaluating your specific needs and shopping around for quotes is key to finding the right coverage. Contact us today for a free quote.

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Frequently Asked Questions

What types of claims does product liability insurance cover?

Product liability insurance covers claims related to injury or damage caused by a company’s product.

What factors determine the cost of product liability insurance?

Product liability insurance costs are determined by factors such as product type, industry, and the coverage amount.

Shawn Plummer, CRPC

Chartered Retirement Planning Counselor

Shawn Plummer is a Chartered Retirement Planning Counselor, insurance agent, and annuity broker with over 14 years of first-hand experience with annuities and insurance. Since beginning his journey in 2009, he has been pivotal in selling and educating about annuities and insurance products. Still, he has also played an instrumental role in training financial advisors for a prestigious Fortune Global 500 insurance company, Allianz. His insights and expertise have made him a sought-after voice in the industry, leading to features in renowned publications such as Time Magazine, Bloomberg, Entrepreneur, Yahoo! Finance, MSN, SmartAsset, The Simple Dollar, U.S. News and World Report, Women’s Health Magazine, and many more. Shawn’s driving ambition? To simplify retirement planning, he ensures his clients understand their choices and secure the best insurance coverage at unbeatable rates.

The Annuity Expert is an independent online insurance agency servicing consumers across the United States. The goal is to help you take the guesswork out of retirement planning and find the best insurance coverage at the cheapest rates

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