What Is the Difference Between Product and Public Liability Insurance?

Product Liability Insurance (Product Liability Insurance) refers to a type of liability insurance that takes the product liability of product manufacturers, sellers, repairers, etc. as an underwriting risk, and product liability is based on the product liability legal systems of various countries.

Product Liability Insurance

Product Liability Insurance (Product Liability Insurance) refers to a type of insurance that takes the product liability of a product manufacturer, seller, repairer, etc. as an underwriting risk.

Product Liability Insurance (Product Liability Insurance) refers to the product manufacturer, seller, repairer, etc.

1. Intangible subject matter:

The subject matter of product liability insurance is the legal liability of the insured and is intangible.

2. Adopt the "claims system":

That is, as long as the insured submits a claim to the insurance company within the insurance period, if it is an insured accident, the insurance company must bear the liability for compensation.

3. Independent claims processing:

Insurance companies have absolute control over claims processing.

4. Differences from "public liability insurance":

The accident must occur outside the place of manufacture or sale of the insured and the ownership of the product has been transferred to the user or seller.

The product liability risk insured by the insurer refers to the economic compensation liability caused by the insured product to consumers or users and anyone else's property loss, personal injury and death, and related legal costs.

1. Insurance liability

(1)

The formulation of the rate of product liability insurance mainly considers the following factors:

1. The characteristics of the product and the risk of damage to human beings or property;

2. Product quantity and product price, it has a positive correlation with insurance premiums and a negative correlation with insurance premium rates;

3. Covered area;

4. The technical level and quality management of the product manufacturer;

5. The level of compensation.

In the product liability insurance claims process, the liability of the insurer is usually based on the occurrence of an accident during the insurance period of the product, regardless of whether the product was produced or sold during the insurance period.

In some cases, it is easy to confuse product liability with product quality breach liability. In fact, although these two are directly related to the product, the risks are in the product itself and both the manufacturer, the seller, and the repairer of the product must bear the corresponding legal liabilities. However, as two types of insurance business of different nature, they still There are essential differences.

First, the nature of risk is different. Product liability insurance covers the infringement of the insured and does not depend on whether there is a contract between the insured and the victim. It is based on the civil and civil law systems of various countries. The product quality assurance insurance covers the insured's breach of contract, and the contract law supplier and the consumer of the product sign a contract as a necessary condition. It is based on economic contract laws and regulations.

Second, the processing principles are different. The principle of handling product liability accidents uses the principle of strict liability in many countries. That is, as long as the victim is not caused by intentional or self-injury, he can obtain financial compensation from the manufacturer or seller of the product, repairer, etc. and receive the protection of the law. The liability for breach of contract of product quality insurance can only be handled by the principle of fault liability. That is, the fault of the product manufacturer, seller, repairer, etc. is a prerequisite for their liability. It can be seen that the strict liability principle is very different from the fault liability principle, and its impact on product liability insurance and product quality insurance is also It has great direct significance.

Product Liability Insurance

Furthermore, the situation of the natural bearer is different from that of the damaged party. From the perspective of the responsible party, in the product liability insurance, the responsible party may be the manufacturer, repairer, consumer, or product of the product. The seller is even the carrier. The manufacturer and seller are jointly and severally liable. The damaged party can choose to claim compensation for damages at the same time. It can also submit compensation claims to multiple parties at the same time. In product quality assurance insurance, the liability holder is limited to the party that provides the substandard product, and the injured party can only submit to him. request. From the perspective of the impaired party, the impaired party of product liability insurance can be the direct consumer or user of the product, or other legal or natural persons who have no relationship with the product, that is, as long as the product causes damage to property or person, There is a statutory right to obtain financial compensation from the person responsible. In product quality insurance, the injured party can only be the consumer of the product.

Fourth, the method of bearing responsibility is different from the standard. The method of bearing liability for product liability accidents can usually only be used to compensate for losses. That is, in product liability insurance, the insurer assumes economic compensation liability. This standard of economic compensation Not restricted by the actual value of the product itself. In product quality insurance, the liability assumed by the insurance company generally does not exceed the actual value of the product itself.

Fifth, the jurisdiction of the lawsuit is different. Product liability insurance covers product liability accidents. Litigation cases for product liability should be under the jurisdiction of the court where the defendant is located or where the infringement occurred. There are cases where the contract for product quality insurance liability is in Jurisdiction of the place of performance.

Sixth, the content of insurance is different in nature. Product liability insurance provides financial compensation liability in lieu of the responsible party. Is a liability insurance. Product quality insurance provides insurance with guarantee nature, which belongs to the category of guarantee insurance.

Due to the essential differences between the two, insurance companies must strictly distinguish between the two types of insurance business. To avoid unnecessary disputes due to customer's lack of understanding. However, in the product insurance market in Europe and the United States, the insured generally assumes both product liability insurance and quality insurance to achieve the purpose of controlling risks and avoiding disputes.

Product Liability Insurance Obligations

1. The insurer shall pay insurance premiums in a timely manner as originally agreed.

2. The insured shall strengthen the quality management, strictly enforce the product inspection system, accept the inspection by the quality inspection department and the insurer's quality inspection and supervision, accept the reasonable advice of the insurer, and provide the insurer with the production, sales, and quality of the relevant products. Documents, books and related materials for inspection and other aspects.

3. Once the insured or his representative is informed of the claim made by the victim or filed a lawsuit with the people's court for product liability compensation, or submitted an arbitration complaint to the arbitration agency, the insured shall immediately notify the company in writing and cooperate with the company to conduct timely investigation . Without the written consent of the company, the insured may not make any promises or compensations; when the company considers it necessary, it has the right to defend and handle any claims in the name of the insured.

4. The insured shall try his best to defend the claims caused by the insurance products and take all measures to prevent the loss from expanding.

5. The insured must notify the company of various important situations (design, technology, raw materials, instructions for use, etc.) that cause risk changes at any time, and adjust the insurance premium according to the company's requirements, otherwise the company will not expand the coverage of the product .

Product liability insurance compensation processing

1. When applying for compensation from the Company, the insured shall submit the relevant accident certificate, medical certificate, product certificate and valid documentary materials deemed necessary by the Company.

2. The amount of compensation paid by the Company to the insured for any accident within the insurance period is limited to the relevant compensation limit stipulated in this insurance policy. When the amount of compensation for multiple accidents reaches the one-year cumulative compensation limit of the insurance policy liability, the insurance policy's insurance liability is terminated immediately.

3. For the same batch of products produced and sold, the personal injury, illness or death of multiple people or the loss of property of multiple people due to the same reason shall be regarded as the loss caused by one accident. ,

4. The company's compensation within the scope of the insurance policy's liability is based on the compensation data determined by the court or arbitration agency or settled out of court by the company's consent.

Product Liability Insurance Other Matters

1. The products covered by this insurance policy must pass the inspection of the product quality inspection agency.

2. Disputes between the insured and the company due to this insurance issue can be resolved through negotiation, or arbitration or litigation can be applied for.

Product Liability Insurance