What type of insurance is crucial for covering liability for defects in a product sold?

Commercial General Liability Insurance is essential for covering liability for defects in products sold by a business. This type of insurance protects businesses against claims of bodily injury or property damage that arise from the use of their products. If a product defect leads to injury or damages, this insurance would cover the legal costs and any settlements or judgments resulting from such claims.

This coverage is particularly important for manufacturers, distributors, and retailers because it addresses the risks associated with product liability. Without this insurance, a business could face significant financial burdens if a defect in a product were to harm a consumer or cause property damage.

Understanding this, it becomes clear that businesses need this type of liability coverage to safeguard themselves financially and maintain their operations in the face of potential lawsuits linked to product defects.