Key Risks for Manufacturing Businesses
Manufacturing businesses face a unique set of risks that can impact every stage of their operations. Understanding these risks is essential for protecting your business, your people, and your reputation. Here are some of the most significant risks manufacturers need to manage:
Production down time
Supply Chain Disruptions
Product Safety Defects
Asset Damage
Workers’ Compensation Claims
Consumer Liability Claims
Regulatory Compliance Risks
Cybersecurity Threats
What kind of insurance do manufacturing companies need?
The level of cover you need will be unique to your manufacturing business, and our brokers will help to find the right one for you. Without the appropriate level of insurance cover, your risk for loss is drastically increased, even in the event of an unforeseen incident.
Public or Products Liability
Public or product liability refers to instances where your product causes or has caused harm to third parties or consumers. By having insurance coverage in this area, you can protect yourself and your manufacturing business from loss in the event of a third party claim.
Management Liability Insurance
If a claim made against your manufacturing business relates to an employee of the company, management liability insurance will provide you with the necessary coverage to prevent major loss.
Business Interruption Insurance
Storms, fires, and floods can all bring manufacturing companies temporarily to a halt, as can instances like theft or damage. Whatever it is that has impacted your business’s ability to operate, business interruption insurance can help to cover the loss.
Cyber Insurance for Manufacturers
As manufacturing increasingly relies on digital systems and automation, cyber threats are a growing concern. Cyber Insurance protects your business against financial losses from data breaches, ransomware attacks, and disruption to operational technology (OT) systems that can halt your production lines. It's crucial for maintaining continuity in a digitally connected factory.
Equipment Breakdown
From assembly line equipment, pumps and compressors, CNC machines to any other manufacturer machinery, equipment breakdowns can cause a big disruption to your usual operations. Insurance against equipment breakdowns or unexpected malfunctions will help to prevent financial loss and get you back on your feet.
Product Recall Insurance
Protecting your businesses from the financial impact of recalling defective or contaminated products to prevent loss or injuries to customers. It covers costs related to withdrawing products, replacing them, and managing public relations. This insurance is crucial for manufacturers, importers, and distributors to mitigate risks associated with accidental contamination, malicious tampering, or defects.
Worker's Compensation Insurance
If one of your manufacturing employees becomes ill or injured and unable to work due to a work-related incident, they may be entitled to worker’s compensation. Taking out worker’s compensation insurance can protect you against major financial loss as a result of this.
Manufacturing Industries We Assist
At Tudor, we confidently work with manufacturing companies across a range of specialties and niches. Some of our current and past clients’ sectors include:
Food and Beverage Manufacturing
Our clients in food and beverage manufacturing face a broad range of risks. These include physical hazards like slips and trips, as well as biological and food safety hazards, supply chain and operational issues, product recalls, and more. By finding them the right level of cover to match their needs, Tudor has helped these businesses stay protected in the event of these incidents.
Chemical Manufacturers
Health hazards relating to chemical exposure is a common area of concern in the chemical manufacturing industry. In addition to these, air contamination, supply chain instability, and cyber threats impacting equipment are just a few more examples of the risks that our chemical manufacturing clients manage through insurance.
Textiles & Clothing
Within the textiles and clothing industry, the risks faced by manufacturers are varied. At Tudor, we can help you to secure insurance that protects your assets from a broad range of risks. From OHS-related claims and machinery issues to supply chain disruptions and product liability, we can help you to navigate the complex landscape of manufacturing insurance.
Plastics & Packaging
At Tudor, our clients in the plastics and packaging manufacturing industry have a wide scope of needs when it comes to their insurance coverage. These range from public and product liability to OHS issues with employees, and many more. Our team is versed in the needs of manufacturers in this industry, and can work to find suitable insurance cover for you, too.
Furniture & Upholstery
If your business is part of the furniture and upholstery manufacturing industry, your insurance should provide you with cover for common issues. These include supply chain disruptions, product defects and recalls, and OHS matters, among others.
Metal & Steel Manufacturing
Our clients in the metal and steel manufacturing industry often require cover against machinery-related breakdowns and incidents, as well as those involving employees' health and safety. By procuring appropriate insurance cover, you can protect yourself and your business in the event of issues such as these.
Get tailored advice on your manufacturing insurance needs today!
Protect your manufacturer business with tailored insurance specific to your needs. As a trusted insurance broker, we understand the risks and challenges faced in the manufacturing sector. Let our expert team help you find the right coverage to help protect your manufacturing business' machinery, assets, employees and overall operation. Get in touch with the experts at Tudor Insurance today.
Speak with Our Manufacturing Insurance Specialist!
Get in touch with one of our experienced brokers for a personalised insurance package using the form here:
Frequently Asked Questions (FAQs) - Manufacturing Insurance
Q: What does manufacturing insurance coverage typically include?
A:Manufacturing insurance coverage commonly includes Public and Products Liability (for injury/damage your operations or products cause), Property and Material Damage (for your factory, equipment, stock), Business Interruption (for lost income), Machinery Breakdown, Product Recall, and Workers' Compensation. Depending on your manufacturing business, Cyber Insurance and Marine Transit cover might also be important.
Q: What types of insurance do manufacturers in Australia need?
A: Australian manufacturers typically need several types of insurance, including property insurance, liability insurance, workers' compensation, and business interruption insurance.
Q: What is the difference between Professional Indemnity (PI) and Public & Products Liability (PL) insurance for manufacturers?
A: Public & Products Liability (PL) insurance covers claims if your manufacturing operations or products cause bodily injury or property damage to others. Professional Indemnity (PI) insurance, on the other hand, covers financial loss claims resulting from your professional advice or services. For manufacturers, PL is almost always essential, while PI might be relevant if you also offer design or consulting services.
Q: What is product liability insurance and why is it important in Australia?
A: Product liability insurance protects your business against claims related to injuries or damages caused by your products. This is crucial for manufacturers to cover legal fees and compensation costs, especially given Australia's strict consumer protection laws.
Q: Does business interruption insurance cover all types of disruptions in Australia?
A: Business interruption insurance generally covers losses due to events like fires or natural disasters that halt operations. However, it may not cover disruptions caused by events like pandemics unless specified in the policy¹.
Q: How can Australian manufacturers protect against equipment breakdowns?
A: Equipment breakdown insurance can cover the costs of repairing or replacing machinery that fails due to mechanical or electrical issues. This can also be extended to cover loss of business income in the event of a breakdown
Q: Is cyber liability insurance necessary for Australian manufacturers?
A: Yes, cyber liability insurance is increasingly important as manufacturers rely more on digital systems. It not only covers costs related to data breaches, cyberattacks, and other cyber incidents, it can also cover costs associated with downtime in the event that critical manufacturing equipment is impacted by a cyber event.
Q: What is the difference between public liability and workers compensation insurance in Australia?
A: Public liability insurance covers claims from third parties for injuries or property damage caused by your business operations. Workers compensation insurance, which is mandatory in Australia, covers claims from employees who get injured or ill due to their work.
Q: How can Australian manufacturers ensure they are adequately covered?
A: It's essential to work with an insurance broker who understands the manufacturing industry to tailor a policy that meets your specific needs and risks.
Q: What should Australian manufacturers do in case of a product recall?
A: Manufacturers should have a product recall plan in place and consider product recall insurance to cover the costs associated with recalling defective products.
Q: How much cover does my manufacturing firm need?
A: The level of cover you need will depend on your business. At Tudor, our brokers will find the perfect package for your needs, and can advise on how to step this up as your business grows. To speak to one of our brokers, get in touch using the form.
