Box Manufacturers Insurance Policy Information

Box Manufacturers Insurance. Eight in every 10 products sold on the North American and European markets are packaged in cardboard boxes - and once you consider the fact that these boxes are additionally used for personal and commercial transportation purposes, it is no surprise that the box manufacturing industry is one of the top paper converters in the world.

Box and paperboard manufacturers produce various types of packaging and disposable containers. They receive large rolls called parent rolls from pulp and paper mills. These rolls are cut, folded, printed, glued, or stapled into products that must be assembled and glued at the customer's plant or ready-to-use boxes.

Product types include cartons, tubes, and corrugated boxes which are made of layers of corrugated paperboard glued together with a flat side (or sides) on top, bottom, or both.

The manufacture of cardboard, or paperboard as it is also called, boxes, may at first glance seem simple. It is not. To make the pulp that forms the foundation of a box from wood chips, chemicals such as sulphate and sulphite are employed. Rolls of paper can then be produced.

The flute, the waved middle layer seen in cardboard that makes it so strong, is made using corrugated roller machines. Cutting, trimming, folding, and adhesion are the next stages in the manufacturing process.

Manufacturers of cardboard or paperboard boxes play an indispensable role in the global supply chain, but they also face countless hazards, including those that cannot be planned for even by the most competent managers.

Thankfully, the right box manufacturers insurance package offers a buffer against the devastating financial losses that unforeseen circumstances would otherwise have. Read on to discover what kinds of insurance box manufacturers should be aware of.

Box manufacturers insurance protects your manufacturing business from lawsuits with rates as low as $57/mo. Get a fast quote and your certificate of insurance now.

Below are some answers to commonly asked box manufacturing insurance questions:

What Is Box Manufacturers Insurance?
How Much Does Box Manufacturers Insurance Cost?
Why Do Box Manufacturers Need Insurance?
What Type Of Insurance Do Box Manufacturers Need?
What Does Box Manufacturers Insurance Cover & Pay For?

What Is Box Manufacturers Insurance?

Box Manufacturers insurance is a type of insurance coverage specifically designed for companies that manufacture boxes and packaging products. This type of insurance typically covers financial losses and damages incurred as a result of business operations, such as property damage, liability claims, and product defects.

It may also include coverage for loss of income, medical expenses for employees, and legal fees if a lawsuit is filed against the company. The insurance protects the box manufacturer from the potential financial losses that can result from these types of risks and helps to ensure their continued business operations.

How Much Does Box Manufacturers Insurance Cost?

The average price of a standard $1,000,000/$2,000,000 General Liability Insurance policy for small box manufacturing businesses ranges from $57 to $79 per month based on location, size, revenue, claims history and more.

Why Do Box Manufacturers Need Insurance?

As a business owner, you will do everything in your power to ensure that your company runs smoothly; you will strive to manufacture your boxes safely, efficiently, and to meet your promised specifications.

The simple fact that not everything is in your power explains why you need to be properly insured - like other businesses, you face a multitude of risks. Some of those will be familiar to any manufacturer, while others apply more specifically to the box making industry.

Any company may suffer catastrophic damage due to a theft, vandalism, or an act of nature such as a wildfire or flood; circumstances you can try to mitigate with security systems, but can never completely prevent. Box manufacturing companies also face unique threats as a result of the raw materials and chemicals they work with during their production process, however, many of which are highly flammable.

Fire or water damage could decimate your inventory, and workers can sustain injuries during the production process, or exposure to the chemicals used to manufacture paperboard boxes could contribute to, or aggravate, a chronic health disorder. Should a crucial piece of equipment break down, the halt in production that follows can be costly, as well.

With the right types of box manufacturers insurance, companies in this industry are able to protect themselves from financial losses resulting from most of these scenarios.

What Type Of Insurance Do Box Manufacturers Need?

Your company's size, location, number of employees, production process, and storage solutions all influence what kind of insurance you should carry. Your specific insurance needs are as unique as your business, and that is why it is key to partner with a commercial insurance agent, ideally one who is deeply familiar with the needs of paperboard manufacturers.

Companies who make paperboard boxes will, however, need at least these three types of box manufacturers insurance:

Commercial Property: This type of insurance protects the building that houses your manufacturing facility as well as the assets therein. Theft, arson, and catastrophic water leaks are examples of unforeseen circumstances that can be covered by commercial property insurance, alongside acts of nature.
General Liability: Should a third party suffer bodily injury or property damage on your premises or as a direct result of your company's activities, they are likely to hold you liable. Commercial general liability insurance covers the legal and settlement costs that may follow.
Workers' Compensation: Despite the fact that workplace injuries are less common in the manufacture of cardboard boxes than in some other industries, accidents can happen. You could be held liable even if a worker slips or trips while at work. Workers comp insurance covers workers' medical costs and offers compensation for lost wages.

These types of box manufacturers insurance are just examples of the types of insurance that box manufacturing firms need. There are others you may want to consider. Product liability insurance, for instance, protects against financial loss in case of product recall, while any company that uses vehicles will also need auto insurance.

To make sure your needs are met properly, consult an agent who specializes in commercial insurance.

Box Manufacturing's Risks & Exposures

Premises liability exposure at the plant is normally low as access by visitors is limited. If tours are given, visitors may be injured by slips, trips, or falls.

Rough lumber stored outside for pallet building can pose an attractive nuisance. These areas should be fenced to prevent unauthorized access, with proper lighting and warnings. Fumes, dust, and noise may be nuisance hazards to neighboring properties.

Products liability exposure is usually low. If products are used to package food products for human or pet consumption, the exposure increases due to the use of inks and adhesives that may contaminate contents. Quality control measures are important.

Environmental impairment exposure is moderate to high. Adhesives, glues, solvents and other hazardous chemicals used in processing could contaminate ground, air, or water. Storage and disposal procedures must adhere to all EPA and other regulatory standards.

Workers compensation exposure is high due to the potential for injury from burns, heat, cuts, puncture wounds, and amputations from box-cutting and slicing operations. Eye injuries are common, as are back injuries from lifting and material handling, slips, trips, and falls, hearing loss from machinery noise, and repetitive motion injuries.

Workers may be crushed by falling parent rolls. Guarding of machines is critical, as well as lockout/tagout procedures during machine maintenance and repair. Exposure to dust, dyes and adhesives can cause eye, skin and lung injuries from irritants.

There should be safety training and personal protection equipment. Drivers of forklifts and vehicles may be injured in accidents.

Property exposure consists of office, plant, and warehouse for storage of parent rolls and finished goods. Ignition sources include electrical wiring, heating and cooling equipment, production machinery, and dust explosions. While tightly wound parent rolls are not highly combustible, the finished goods are subject to damage from fire, smoke, and moisture.

Without adequate dust collection and ventilation systems, dust generated in the cutting and handling processes can explode, causing a fire. Chemicals used for coatings, fuels, flammable adhesives and inks used to complete most boxes add significantly to the fire load. These should be stored away from combustibles.

Poor housekeeping, such as failure to collect and dispose of scraps on a regular basis, could contribute significantly to a loss.

Equipment breakdown exposures include malfunctioning production equipment, ventilation and dust collection systems, electrical control panels and other apparatus. A lengthy breakdown to production machinery could result in a severe loss, both direct and indirect such as time element.

Crime exposure is from employee dishonesty. Background checks should be conducted on all employees. There must be a separation of duties between persons handling deposits and disbursements and handling bank statements.

Inland marine exposures include accounts receivable if the manufacturer offers credit, computers (which may include computer-run production equipment), exhibitions, goods in transit, and valuable papers and records for customers' and suppliers' information. Paper and paperboard boxes are all susceptible to damage by fire, water, collision or overturn.

Business auto exposure can be high if the manufacturer transports parent rolls or finished goods. Tie down of parent rolls is very important because they can be as large and as heavy as logs. Manufacturers generally have private passenger fleets used by sales representatives.

There should be written procedures regarding the private use of these vehicles by others. Each driver should have an appropriate license and an acceptable MVR. All vehicles must be well maintained with documentation kept in a central location.

What Does Box Manufacturers Insurance Cover & Pay For?

Box manufacturers, like other businesses, can face a variety of legal issues that might lead to lawsuits. These could include product liability, workers' compensation, property damage, and more. Let's look at a few possible scenarios and how insurance can help.

Product Liability: If a box manufacturer produces faulty or unsafe boxes that cause damage or injury (for example, if a box breaks during transport and damages the goods inside, or if a poorly designed box causes injury to a worker), they could be held liable. In this case, having product liability insurance can cover the costs associated with the lawsuit, including legal fees and any damages awarded.

Workers' Compensation: Employees of the box manufacturer could get injured while on the job. For instance, they might get hurt by machinery or due to repetitive strain from the physical labor. In such situations, workers might sue the company for compensation. Workers' compensation insurance can cover medical costs, lost wages, and legal fees associated with such claims.

Property Damage: Accidents or natural disasters could damage the box manufacturer's property, halting production and causing significant financial loss. If a third party sues the box manufacturer because this halt in production affected their business, commercial property insurance could help cover the costs of these lawsuits.

Environmental Liability: Box manufacturers may also be sued for environmental damage, especially if their manufacturing processes involve harmful chemicals or result in waste that pollutes the environment. Environmental liability insurance can help cover the costs associated with cleanup, regulatory fines, and legal defense.

Intellectual Property Infringement: If a box manufacturer is sued for unintentionally infringing on another company's patent, copyright, or trademark (e.g., a specific box design or technology), intellectual property insurance can help cover the legal costs and any potential settlement or damages awarded.

Directors and Officers Liability (D&O): If a decision made by a director or officer of the box manufacturing company leads to financial loss or other harm, and they are sued as a result, D&O insurance can help cover legal costs and potential settlements.

Commercial Auto: If the box manufacturer uses vehicles for business operations (e.g., delivery trucks) and an accident occurs, commercial auto insurance would cover the cost of property damage or bodily injury claims that could arise.

Remember, the exact coverage of an insurance policy can vary widely based on the specific terms and conditions. It's crucial for box manufacturers, like all businesses, to work closely with their insurance brokers or agents to ensure they have the appropriate coverage for their specific risks.