Engine Manufacturers Insurance Policy Information
Engine Manufacturers Insurance. Engines are, simply said, machines that turn one form of energy, from fuel, into mechanical energy that results in motion.
Engine manufacturers produce engines used to power hand tools, aircraft, contractors' equipment, forklifts, vehicles, and watercraft.
The engines may be powered by diesel, gasoline, kerosene, LPG (liquid petroleum gas) or electronic fuel cells and be used in products as varied as chainsaws, lawnmowers, end loaders, boat motors, farm and industrial equipment and conveyors, airplanes, automobiles, and trucks.
The process consists of product design, developing patterns or molds for component parts, making or subcontracting the various parts, assembling the final product, finishing, testing and quality control, and delivery to the customer.
Operations include metal casting, forging, and the assembly of parts manufactured elsewhere. In addition to cast iron engine blocks, other parts may be drawn or stamped from iron or steel alloys. Parts may be heat treated, sandblasted, electroplated and annealed.
Fabricating exposures range from machining and boring to welding and spray-painting. There may be incidental work with plastics or rubber parts.
Because of the varieties of materials and processes involved, the different phases of manufacture may be carried out in different locations or different countries.
Engines (also called motors) can be divided into two broad categories; while fuel combustion occurs within the engine in internal combustion engines, it takes place outside in the case of external combustion engines.
Cars and rucks, motorcycles, watercraft such as boats and submarines, aircraft, and locomotives are only some examples of the many inventions that ultimately depend on engines to work - and as such, engine manufacturers play a crucial role in the global supply chain.
They also, however, face a multitude of risks that could potentially have devastating financial consequences. This is why any company that manufacturers engines or engine components needs to be armed with comprehensive engine manufacturers insurance.
To find out what that may entail, keep reading.
Engine manufacturers insurance protects your manufacturing business from lawsuits with rates as low as $77/mo. Get a fast quote and your certificate of insurance now.
Below are some answers to commonly asked engine manufacturing insurance questions:
- What Is Engine Manufacturers Insurance?
- How Much Does Engine Manufacturers Insurance Cost?
- Why Do Engine Manufacturers Need Insurance?
- What Type Of Insurance Do Engine Manufacturers Need?
- What Does Engine Manufacturer Insurance Cover & Pay For?
What Is Engine Manufacturers Insurance?
Engine manufacturers insurance is a type of insurance coverage that provides financial protection for engine manufacturers against various risks and liabilities that may arise during the production and sale of engines. This type of insurance may cover damages resulting from product defects, product liability claims, and other issues that may arise in the manufacturing process. It is designed to protect engine manufacturers from financial losses and help ensure the stability and longevity of their business.
How Much Does Engine Manufacturers Insurance Cost?
The average price of a standard $1,000,000/$2,000,000 General Liability Insurance policy for small engine manufacturing businesses ranges from $77 to $799 per month based on location, size, revenue, claims history and more.
Why Do Engine Manufacturers Need Insurance?
Companies that manufacture engines may be impacted by a wide range of perils, despite doing everything in their power to operate a thriving business.
The risks that manufacturers within this field have to consider include those universal to all businesses, as well as those unique to their own industry.
Catastrophic property damage and loss may occur, for example, as a result of criminal acts like (digital as well as physical) theft, burglary, and vandalism, including arson. Acts of nature, which would include hail, earthquakes, lightning strikes, wildfires, and serious floods can halt your production overnight and without much warning.
Essential manufacturing equipment could suddenly break down.
Employees or third parties could become injured on your premises and subsequently hold your company liable. Engine manufacturers also have to consider the risk that vehicles or other products into which their engines are incorporated could become involved in an accident.
Should engine failure prove to be a factor, the costs of the litigation that will likely follow may be staggering.
Even despite your best efforts, not all accidents and other unforeseen circumstances can be prevented.
This is why you unquestionably need engine manufacturers insurance to protect you from the financial consequences of these and many other perils.
What Type Of Insurance Do Engine Manufacturers Need?
There is no one-size-fits-all answer to this question; each engine manufacturer is unique. Factors such as the location of your manufacturing facility, the type of engine you produce, your output quantities, and your number of employees all influence your insurance needs.
Consulting an agent specializing in commercial insurance who has a deep understanding of your field is an essential step in crafting the insurance plan you require.
The most important types of insurance coverage for engine manufacturers include:
A commercial insurance agent is an invaluable guide in your process of becoming properly insured. In spite of the fact that your needs will vary, engine manufacturers insurance policies required are:
- Commercial General Liability: Should a third party file a bodily injury or property damage claim against your company, this type of insurance is designed to help cover the resulting legal defense costs. The exact events covered by commercial general liability insurance vary from one plan to the next.
- Product Liability: This type of insurance covers liability claims as they relate to the products you manufacture, in this case engines or engine components, even once they are incorporated into other products. Product liability insurance is essential for any company that makes products with the potential to malfunction and cause damage or injury.
- Commercial Property: This type of engine manufacturers insurance exists to protect commercial ventures against financial losses resulting from damage to or loss of property caused by acts of nature, theft, and vandalism. Your physical building is covered, by also physical assets within, such as raw materials, manufacturing equipment, computers, and finished inventory.
- Workers' Compensation: In all fields, employees can become injured in the workplace, or suffer occupational illnesses resulting, for instance, from the inhalation of toxic substances or even repetitive stress injury. Should this happen within your company, the employee's medical costs as well as any wages lost while they are unable to work are reimbursed if you have workers' compensation insurance.
Insurance may not be as complex as the manufacturing of engines, but the fact remains that the modern market offers numerous different types of coverage.
Because your engine manufacturers insurance needs as well as the costs of your coverage vary widely, even among companies within the same field, consulting a commercial insurance agent is a vital step.
Engine Manufacturing's Risks & Exposures
Premises liability exposure is low due to limited access by visitors. If tours are given or if outsiders are allowed on premises, visitors may be injured by slips, trips, or falls. Fumes and noise from processing may affect neighbors, resulting in nuisance claims.
Off-premises liability exposures come from exhibitions or demonstrations at retail locations, fairs, or conventions.
Products liability exposure is moderate to high depending on the final use of the engine. For small consumer items, product failure may be limited to that of an inconvenience. If the engine fails in a motor vehicle, aircraft, industrial machine or watercraft, consequences can be severe due to the high number of people who could be injured or killed. Engine failure can also result in significant indirect losses, such as factory downtime.
An engine may overheat and "seize" (the moving parts may melt together); its pressure may rise and it may then crack, rupture or fly apart; it may become corroded, leak fuel or oil, or even catch fire. Engine failure may be caused by improper use or poor maintenance by the customer, but it may also be caused by the manufacturer's negligence.
Losses may be caused by poor workmanship, faulty design, or hidden damage during storage (such as rust) or during shipping (such as unseen breakage of a part). It may be impossible to defend against questionable claims unless there is an aggressive quality control program including high standards for materials, testing and monitoring of components, and documentation of sources (often down to the individual part).
With proper maintenance, an engine may last a long time. Older units made before improved safety features were introduced may still be in use, extending the period for product liability claims to be made.
Environmental impairment exposure can be moderate to high due to the potential for air, land and water pollution from dust and fuel storage tanks. Metal contaminants may come from the chemicals, paints, and solvents used. Vapors, fumes and air pollutants, wastewater and disposal of by-products must be evaluated and controlled.
Disposal of plastics, chemicals, and flammable liquids must adhere to all EPA and other regulatory standards. There may be fuel tanks on premises with the potential for spillage and contamination. If there are underground tanks, a UST policy may be required.
Workers compensation exposures are significant. Injuries from production machinery are common, as are minor cuts, slips, trips, falls, foreign objects in the eye, back injuries from lifting, hearing loss from noise, and repetitive motion losses. Workstations should be ergonomically designed. Employees should be provided with safety training and protective equipment.
Areas that generate dust require respiratory protection devices, as well as eye protection and eye wash stations. Work with metals at high temperatures may result in burns, and chemical burns are also possible from lubricants and fuels. Fuels, lubricants, alloys and metal treatment agents (as in polishing) may irritate skin, eyes, and lungs.
Parts may come loose and injure workers in experimental engine design during the testing process. Containment areas should be used for testing.
Property exposure consists of office, plant, and warehouse or yard for storage of raw materials, components, and finished engines. Ignition sources include electrical wiring, heating systems, production machinery, and high-temperature operations like casting, forging, welding and soldering.
Wear and tear and overheating of machinery are potential fire hazards. There may be gasoline or kerosene tanks on premises. Hazards may include sheet metal work, casting, heat treating, or electroplating. In the absence of well-maintained dust collection systems, cutting and buffing operations can generate dust which can catch on fire. Welding should be done in a separate area away from combustibles.
Spray painting should be conducted in an area with explosion-proof wiring that meets all UL standards. Poor housekeeping, such as failure to collect and dispose of trash on a regular basis, could contribute significantly to a loss. Unless disposed of properly, greasy, oily rags (such as those used to clean machinery) can cause a fire without a separate ignition source.
Property stored in the open may be subject to loss by wind or hail or a target for vandalism. Appropriate security controls must be taken including lighting and physical barriers to prevent entrance to the premises after hours and an alarm system that reports directly to a central station or the police department.
Bottlenecks in the assembly process may result in a high concentration of values of partially completed engines, affecting both property valuation and business income. There may be a substantial exposure to loss of income resulting from damage to dependent properties such as key suppliers or customers.
Equipment breakdown exposures include malfunctioning production equipment, dust collection and ventilation systems, electrical control panels and other apparatus. These should be properly maintained and records kept in a central location. A lengthy breakdown could result in a severe loss, both direct and under time element.
Crime exposure comes from employee dishonesty and theft as component parts and finished items may be high in value. Employees may act alone or in collusion with outsiders in stealing money, raw materials or finished stock.
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. There should be security methods in place to prevent theft.
Inland marine exposures include accounts receivable if the manufacturer offers credit, computers (which may include computer-run production equipment), goods in transit, and valuable papers and records for customers' and suppliers' information. Backup copies of all records should be made and stored off premises. The primary causes of loss are theft, collision, and overturn.
Business auto exposure can be high if the manufacturer delivers engines to customers or picks up materials. Transportation of large engines requires careful loading and tie-down to prevent items from coming loose during transport. Manufacturers generally have private passenger fleets used by sales representatives.
There should be written procedures regarding the private use of these vehicles. Drivers should have an appropriate license and an acceptable MVR. All vehicles must be well maintained with documentation kept in a central location.
What Does Engine Manufacturer Insurance Cover & Pay For?
Engine manufacturers, like any other businesses, can be sued for a variety of reasons. Here are some examples and how insurance can help protect them:
1. Product Liability: This is the most common reason for lawsuits in this sector. If a customer or business believes that the engine manufactured by a company has a design flaw or manufacturing defect that caused harm or financial loss, they can sue the company. For instance, if an engine failure leads to a plane crash or a vehicle accident, the engine manufacturer could face a product liability lawsuit.
Insurance Protection: In this case, Product Liability Insurance can help protect the manufacturer. This type of insurance is designed to cover the costs associated with product-related defects and can help pay for legal defense costs, settlements, and court-ordered judgments. It can also cover the costs related to a product recall.
2. Breach of Warranty: Engine manufacturers can be sued for breach of warranty if they fail to fulfill the terms of a warranty. This could be the case if an engine fails within the warranty period and the manufacturer refuses to repair or replace it.
Insurance Protection: Commercial General Liability (CGL) Insurance often includes coverage for breach of warranty claims. The insurance can help pay for legal defense, and if the company is found liable, it can cover the damages awarded to the plaintiff. In addition, a specific warranty insurance can be taken out to cover claims arising from the failure to honor warranties or guarantees.
3. Intellectual Property Infringement: If an engine manufacturer is accused of infringing upon another company's patent, trademark, or other intellectual property rights, they can be sued. For example, if an engine design is alleged to be too similar to a patented design of another manufacturer, it could result in litigation.
Insurance Protection: Intellectual Property Insurance can help in such situations. This insurance can cover the legal costs associated with defending against claims of infringement. In some cases, it may also cover the costs of any settlements or judgments, depending upon the specifics of the policy.
4. Environmental Damage: Engine manufacturers could also face legal action if their operations result in environmental harm. For instance, if waste from the manufacturing process contaminates local water sources, the company could be sued for cleanup costs and damages.
Insurance Protection: Environmental Impairment Liability (EIL) Insurance can help cover these costs. It can pay for legal defense, cleanup efforts, and damages associated with environmental pollution caused by a company's operations.
It's important to note that the specifics of what each insurance policy covers can vary widely, so engine manufacturers need to ensure they understand the terms and conditions of their policies. Working with a knowledgeable insurance broker can help a company choose the right coverage for its needs.
Commercial Insurance And Business Industry Classification
- SIC CODE: 3714 Motor Vehicle Parts And Accessories, 3519 Internal Combustion Engines, Not Elsewhere Classified
- NAICS CODE: 336310 Motor Vehicle Gasoline Engine and Engine Parts Manufacturing, 333618 Other Engine Equipment Manufacturing
- Suggested Workers Compensation Code(s): 3612 Pump Manufacturing, 3826 Aircraft Engine Manufacturing, 3827 Automobile - Engine Manufacturing
Description for 3714: Motor Vehicle Parts And Accessories
Division D: Manufacturing | Major Group 37: Transportation Equipment | Industry Group 371: Motor Vehicles And Motor Vehicle Equipment
3714 Motor Vehicle Parts And Accessories: Establishments primarily engaged in manufacturing motor vehicle parts and accessories, but not engaged in manufacturing complete motor vehicles or passenger car bodies. Establishments primarily engaged in manufacturing or assembling complete automobiles and trucks are classified in Industry 3711; those manufacturing tires and tubes are classified in Industry 3011; those manufacturing automobile glass are classified in Major Group 32; those manufacturing automobile stampings are classified in Industry 3465; those manufacturing vehicular lighting equipment are classified in Industry 3647; those manufacturing ignition systems are classified in Industry 3694; those manufacturing storage batteries are classified in Industry 3691; and those manufacturing carburetors, pistons, piston rings, and engine intake and exhaust valves are classified in Industry 3592.
- Air brakes, motor vehicle
- Automotive wiring harness sets, except ignition
- Axle housings and shafts, motor vehicle
- Axles, motor vehicle
- Ball joints, motor vehicle
- Bearings, motor vehicle: except ball and roller
- Brake drums
- Brakes and brake parts, motor vehicle
- Bumpers and bumperettes, motor vehicle
- Camshafts, motor vehicle gasoline engine
- Cleaners, air: motor vehicle
- Connecting rods, motor vehicle: gasoline engine
- Control equipment, motor vehicle: acceleration mechanisms and
- Crankshaft assemblies, motor vehicle: gasoline engine
- Cylinder heads, motor vehicle: gasoline engines
- Defrosters, motor vehicle
- Differentials and parts, motor vehicle
- Directional signals, motor vehicle
- Drive shafts, motor vehicle
- Dump truck lifting mechanisms
- Engines and parts, except diesel: motor vehicle
- Exhaust systems and parts, motor vehicle
- Fifth wheels
- Filters: oil, fuel, and air-motor vehicle
- Frames, motor vehicle
- Fuel pumps, motor vehicle
- Fuel systems and parts, motor vehicle
- Gas tanks, motor vehicle
- Gears, motor vehicle
- Governors, motor vehicle
- Heaters, motor vehicle
- Hoods, motor vehicle
- Horns, motor vehicle
- Hydraulic fluid power pumps for auto motive steering mechanisms
- Instrument board assemblies, motor vehicle
- Lubrication systems and parts, motor vehicle
- Manifolds, motor vehicle: gasoline engine
- Motor vehicle gasoline engine rebuilding on a factory basis
- Motor vehicle parts and accessories, except motor vehicle stampings
- Mufflers, exhaust: motor vehicle
- Oil filters, motor vehicle
- Pipes, fuel: motor vehicle
- Power transmission equipment, motor vehicle
- Pumps, motor vehicle: oil, water, fuel, and power steering
- Radiators and radiator shells and cores, motor vehicle
- Rear axle housings, motor vehicle
- Rebuilding motor vehicle gasoline engines and transmissions on a
- Rims, wheel: motor vehicle
- Sanders, motor vehicle safety
- Shock absorbers, motor vehicle
- Steering mechanisms, motor vehicle
- Thermostats, motor vehicle
- Third axle attachments or six wheel units for motor vehicles
- Tie rods, motor vehicle
- Tire valve cores
- Tops, motor vehicle: except stamped metal
- Transmission housings and parts, motor vehicle
- Transmissions, motor vehicle
- Universal joints, motor vehicle
- Vacuum brakes, motor vehicle
- Wheels, motor vehicle
- Windshield frames, motor vehicle
- Windshield wiper systems, all types
- Winterfronts, motor vehicle
- Wiring harness sets motor vehicles, except ignition
Description for 3519: Internal Combustion Engines, Not Elsewhere Classified
Division D: Manufacturing | Major Group 35: Industrial And Commercial Machinery And Computer Equipment | Industry Group 351: Engines And Turbines
3519 Internal Combustion Engines, Not Elsewhere Classified: Establishments primarily engaged in manufacturing diesel, semi-diesel, or other internal combustion engines, not elsewhere classified, for stationary, marine, traction, and other uses. Establishments primarily engaged in manufacturing aircraft engines are classified in Industry 3724, and those manufacturing automotive engines, except diesel, are classified in Industry 3714.
- Diesel and semi-diesel engines for stationary, marine, traction, etc
- Diesel engine parts
- Engines and engine parts internal combustion military tank
- Engines, internal combustion except aircraft and non-diesel
- Engines diesel and semi-diesel and dual fuel-except aircraft
- Gas and diesel engine rebuilding, on a factory basis
- Governors, diesel engine
- Internal combustion engines, except aircraft and non-diesel automotive
- Marine engines: diesel, semi-diesel, and other internal combustion
- Outboard motors, except electric
- Semi-diesel Engines for stationary, marine, traction, or other uses
- Tank engines and engine parts, internal combustion: military
Engine Manufacturers Insurance - The Bottom Line
Engine manufacturers insurance policies can differ widely in coverage, costs and exclusions. To find out if your engine manufacturing firm has the best fit insurance policies - talk to an experienced commercial insurance broker.
Often they are able to save you on premiums and offer you better policy options than you currently have.
Additional Resources For Manufacturing Insurance
Learn all about manufacturing insurance. Manufacturers face many unique risks such as product libility and/or product recall exposures due to the nature of their business operations.
- 3D Printing
- Adhesives
- Alarms
- Audio & Video Equipment
- Auto Parts
- Bottling Plants
- Boxes
- Bricks
- Brooms & Brushes
- Buttons
- Cabinets
- Camping Equipment
- Canned Fruit & Vegetables
- Cans
- Canvas Products
- Caskets
- CBD Oil And Hemp
- Cement
- Ceramics
- Chemical
- Clock & Watch
- Clothing
- Coffee
- Commercial Air Conditioning
- Commercial Electronics
- Communications Equipment
- Computers
- Condoms
- Construction Equipment
- Cork Products
- Cosmetics
- Cutlery
- Dairies & Creameries
- Down And Feather Products
- Dry Ice
- Dyes & Pigments
- Electronic Toys & Games
- Electroplating
- Elevators
- Engines
- Exercise Equipment
- Farm Equipment
- Feed & Grain
- Fences
- Fertilizer
- Fireworks
- Flavoring Extracts
- Frozen Foods
- Fruit Juice
- Fur Garment
- Garage Door
- Gears
- Glass
- Glasswear
- Gypsum Products
- Hosiery
- Ice Cream
- Industrial Equipment
- Ink
- Insecticides
- Iron & Steel Foundries
- Jewelry
- Lawn Mowers
- Leather Apparel
- Leather Goods
- Lighting & Wiring
- Lumber & Wood Products
- Machine Shop
- Major Electrical Appliances
- Manufacturing
- Marijuana Products
- Mattresses & Box Springs
- Metal & Plastic Furniture
- Metal Heat Treating
- Metal Toys
- Millwork
- Monuments
- Musical Instruments
- Nanotechnology
- Nonferrous Foundries
- Ornamental Metalwork
- Paint
- Paper & Allied Products
- Pesticides
- Pet Food
- Pharmaceuticals
- Plastic & Rubber Toys
- Plastic Goods
- Plastics
- Plastics Molding, Forming & Extruding
- Pottery
- Product Liability
- Prosthetics
- Psychedelic Drugs
- Pulp & Paper Mills
- Refractory
- Residential Air Conditioning & Heating
- Rubber Goods
- Rugs
- Sawmills & Planing Mills
- Screw Machine Products
- Sheet Metal
- Soap & Detergent
- Shoes
- Small Electrical Appliances
- Sporting Goods
- Springs
- Stone Products
- Tanneries
- Textiles
- Textiles Finishing & Coating
- Tires
- Tobacco
- Tool & Die Shops
- Vegetable Juice
- Vending Machines
- Watercraft
- Wire
- Wire Rope
- Wood Furniture
- Woodworking
- Writing Instruments
- Yarn
- Specialty Manufacturing
- Specialty Product Liability
The manufacturing industry is a vital part of the economy and plays a significant role in the production of goods and services. However, it is also an industry that is prone to risks and accidents, which can result in costly damages and lawsuits. Therefore, it is essential for businesses in the manufacturing industry to have insurance to protect them against potential losses.
Business insurance can cover a wide range of risks, including property damage, liability, and worker injuries. For instance, if a fire were to break out in a manufacturing facility and destroy equipment or inventory, commercial insurance could cover the costs of replacing or repairing the damages. Similarly, if a worker were to be injured on the job, business insurance could cover medical expenses and lost wages.
In addition to protecting against physical damages, insurance can also provide financial protection against legal liabilities. If a customer were to sue a manufacturing business for a faulty product, the commercial insurance could cover the costs of legal fees and settlements.
Overall, insurance is essential for the manufacturing industry as it helps to mitigate risks and protect against unexpected costs. Without it, businesses in the industry could face financial ruin in the event of an accident or lawsuit.
Minimum recommended small business insurance coverage: Building, Business Personal Property, Business Income with Extra Expense, Equipment Breakdown, Employee Dishonesty, Accounts Receivable, Computers, Goods in Transit, Valuable Papers and Records, General Liability, Employee Benefits Liability, Environmental Impairment Liability, Umbrella Liability, Hired and Non-owned Auto Liability & Workers Compensation.
Other commercial insurance policies to consider: Earthquake, Flood, Cyber Liability, Employment-related Practices Liability, Business Auto Liability and Physical Damage and Stop Gap Liability.
