What does "product liability insurance" safeguard against?

Product liability insurance is specifically designed to protect businesses from financial losses that arise due to claims related to injuries or damages caused by their products. This type of insurance covers legal costs, settlements, and other expenses that may result from lawsuits filed by consumers who have suffered harm due to the use of a faulty or defective product.

Understanding this insurance is vital for businesses that manufacture or sell products, as it provides a safety net against the potentially devastating financial impact of claims that could affect their operations and bottom line. It enables businesses to operate with confidence, knowing they have a measure of protection against the risks associated with their products. This means that if a customer is injured or suffers property damage as a result of a product malfunction, the insurance can help cover the costs related to the claims, ensuring that the business can focus on its operations without undue financial stress.

Other options presented, while related to liability and business operations, do not accurately capture the primary focus of product liability insurance. Claims of injury from business practices pertain more towards general liability insurance, while loss of income and marketing costs relate to different forms of business risks not covered under product liability.