Fireworks Manufacturers Insurance Policy Information
Fireworks Manufacturers Insurance. Fireworks quite similar to those used today have graced important celebrations since at least the 9th Century, but their manufacture has become increasingly sophisticated over time.
Despite the fact that elaborate pyrotechnics displays are undoubtedly breathtakingly beautiful, it will have escaped nobody that fireworks can also pose a life-threatening risk. This places manufacturers in a uniquely delicate situation.
Fireworks manufacturers produce products designed to explode in particular configurations, to display specific colors, and to burn for a specified amount of time. Many have an auditory component, such as the computer-controlled timing of explosions set to music.
Commercial-use (or "display") fireworks contain added explosive materials and are launched by mortars, set into frames, and are supervised by a trained pyrotechnician. Consumer products contain very limited amounts of explosive material and include firecrackers, fountains, and Roman candles.
Products such as smoke balls, snakes, or sparklers contain no explosive material, but use chemicals to produce their desired effect. Black powder (gunpowder) is combined with coloring agents (called "paint" in the industry), dried, and shaped if necessary, then inserted into paper or plastic shells or containers.
Finally, a fuse is added, and the product is packed and shipped. There is a strict distinction made between commercial and consumer products. Although various federal, state, and local governmental agencies control the manufacture, sales, transport, and display of fireworks, the potential for loss remains very high.
The foundation of any firework is its shell, made from cardboard or paper. Although each manufacturer will have their own close-guarded formula, basic ingredients have remained the same over the course of many centuries - potassium nitrate, sulfur, and charcoal ("black powder"), a fuse, a lift charge, a launch tube, and "stars".
These metal salts, such as magnesium, copper chloride, and aluminum, packed into specific patterns, give fireworks their colors and shapes.
As fireworks manufacturers work with these sensitive chemicals and flammable materials, they will need top-notch insurance to protect their company from unforeseen circumstances.
What do manufacturers in the pyrotechnics industry need to know about their insurance needs? For an overview of the types of fireworks manufacturers insurance you cannot do without, keep reading.
Fireworks manufacturers insurance protects your manufacturing business from lawsuits with rates as low as $97/mo. Get a fast quote and your certificate of insurance now.
Below are some answers to commonly asked fireworks manufacturing insurance questions:
- How Much Does Fireworks Manufacturers Insurance Cost?
- Why Do Fireworks Manufacturers Need Insurance?
- What Type Of Insurance Do Fireworks Manufacturers Need?
How Much Does Fireworks Manufacturers Insurance Cost?
The average price of a standard $1,000,000/$2,000,000 General Liability Insurance policy for small fireworks manufacturing businesses ranges from $97 to $139 per month based on location, size, revenue, claims history and more.
Why Do Fireworks Manufacturers Need Insurance?
As a responsible modern fireworks manufacturer, your company will go to great lengths to meet health and safety regulations and to ensure that your business runs smoothly. Despite that, you are always at risk of encountering circumstances beyond your control.
All commercial ventures require insurance, regardless of their field, size, and risk profile, since they can all be subject to events that could lead to catastrophic financial losses and legal liability. Any company can be struck, for instance, by theft or acts of vandalism.
Any company's financial health can suffer greatly in the event the business is hit by an act of nature - environmental phenomena such as wildfires, floods, and lightning strikes that can damage or destroy buildings as well as equipment and inventory.
All manufacturers, and many companies in different fields, also run the risk that workers become injured in the workplace, that third parties sustain injuries on their premises, or that their activities cause accidental damage to others' properties. All of these events can quickly become legal and financial minefields.
As a manufacturer of pyrotechnics, you are in a special position - you work with explosives and hazardous chemicals alike, and even after your beautiful fireworks safely leave your manufacturing facility, their improper use or potential malfunction can do great damage.
This is why rock solid fireworks manufacturers insurance coverage is even more important for you than for commercial ventures in many other fields.
What Type Of Insurance Do Fireworks Manufacturers Need?
A seasoned commercial insurance agent can guide you through your needs, which will vary depending on your company's size, its number of workers, its geographical location, and numerous other factors.
You will, however, want to look for a company that is deeply familiar with, and by preference specializes in, the pyrotechnics industry. These insurance companies will understand your need and have your back.
Many kinds of fireworks manufacturers insurance exist, and among the types you will certainly want to carry are:
- Commercial Property: This type of insurance will cover your real estate in case circumstances that include acts of nature, theft, and vandalism cause serious damage or destruction. It can also cover the manufacturing equipment and other physical assets inside.
- Commercial General Liability: Should a third party sustain bodily injury within your facilities, or should your company's activities damage third party property as the result of an accident, this type of insurance will help cover your legal costs and settlement fees.
- Product Liability: Especially important for manufacturers of potentially hazardous products such as fireworks, product liability insurance has your back if, for instance, your pyrotechnics explode in transit or their improper use causes injury. As with general liability insurance, it can cover legal expenses. It can also allow you to recover revenue lost if a product needs to be recalled.
- Workers Compensation: This type of fireworks manufacturers insurance is absolutely indispensable; it covers employees' medical bills and lost wages in the event of workplace injury (both acute and, for instance, long-term occupational injury as a result of inhaling toxic chemicals), while at the same time safeguarding your company against costly civil suits.
Keep in mind that these types of fireworks manufacturers insurance are simply examples of your coverage needs, as well as that these kinds of insurance will be available in different tiers.
To make sure that you have the quality coverage you can count on, turn to a competent business insurance broker who specializes in the fireworks industry.
Fireworks Manufacturing's Risks & Exposures
Premises liability exposure is high due to the potential for damage to neighboring premises by fire, explosion, and smoke. Access by visitors should be limited. If the manufacturer conducts tours, visitors may be injured by slips, trips, or falls.
The entire area should be fenced with warnings posted to prevent unauthorized access. If fireworks displays are conducted by the manufacturer, hazards increase significantly.
Products liability exposure is high due to the inherently dangerous nature of fireworks. Serious property damage and bodily injury may occur even when used as instructed. Significant injuries or damage may follow from poor quality control, improper storage, transport, or inappropriate packaging and labeling. Courts may apply strict liability standards, especially to goods sold to consumers that are used without professional supervision.
Environmental impairment exposure is very high. Coloring agents may contain toxic ingredients and heavy metals. Waste disposal may contaminate the ground, air, and waterways. Disposal of wastes must adhere to all federal and state guidelines.
Workers compensation exposures are severe due to the explosive nature of fireworks. Should there be an explosion, amputation, loss of limbs, or fatalities may occur. Workers can inhale the black powder or chemical compounds, resulting in skin or lung irritation or respiratory problems. Injury and disease from toxins can occur from coloring agents that include heavy metals.
All employees must be aware of the potential side effects and symptoms of medical conditions associated with the chemicals used, including the long-term occupational disease hazard. Injuries from production machinery are common, as are burns, cuts, slips, trips, falls, foreign objects in the eye, hearing impairment from noise, back injuries from lifting, and repetitive motion injuries.
Workstations should be ergonomically designed. Workers should wear 100% cotton clothing to prevent the buildup of static electricity. Because sales of fireworks are seasonal, time pressures may result in safety procedures being ignored, especially with regard to material handling.
If employees are used to conduct fireworks displays, they should be well trained and wear OSHA-approved hearing equipment. A spotter should be on hand to warn the operator, and a fire extinguisher should be readily available.
Property exposure consists of office, plant, warehouse for finished goods, and yard for storage of raw materials. Hazards are very high due to the explosive ingredients used and the flammable casings. Ignition sources include electrical wiring, heating and cooling systems, production machinery, the buildup of static electricity, sparks, or dust, any of which could trigger a destructive chain reaction.
Raw materials, chemicals, and end products should be separated from the processing area and kept in proper storage rooms. Electrical outlets should be explosion-proof. Storage areas should be kept cool to prevent explosions. Poor housekeeping may be a serious fire hazard. All fire prevention and reduction methods need to be carefully reviewed and evaluated.
Access by emergency personnel may be limited because fireworks manufacturers are often situated away from population centers. Raw materials and finished stock can be targets for theft. 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.
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 under time element.
Crime exposures are chiefly from theft, either by third parties or employees, due to the attractive yet restricted use of explosives. Given the difficulty of extracting large amounts of explosives from the finished product, this hazard is prominent for raw materials.
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. The manufacturer should have security methods in place to keep all unauthorized personnel away from the explosives.
Inland marine exposures include accounts receivable if the manufacturer offers credit, computers, exhibitions, goods in transit, and valuable papers and records for customers' and suppliers' information. Stock in transit is susceptible to damage from fire, explosion, and water. Transport of fireworks is closely controlled by the Department of Transportation (DOT). Prior to any transport, DOT approval must be obtained.
Commercial auto exposure is very high due to the potential for fire and explosion of the cargo, which may cause injury or damage to persons or property in the vicinity. Transport of fireworks is closely controlled by the Department of Transportation (DOT). DOT approval must be obtained prior to any transport.
Manufacturers generally have private passenger fleets used by sales representatives. There should be written procedures regarding the private use of these vehicles by others. Drivers should have an appropriate license and an acceptable MVR. All vehicles must be well maintained, with documentation kept in a central location.
Commercial Insurance And Business Industry Classification
- SIC CODE: 2899 Chemicals And Chemical Preparations, Not Elsewhere Classified
- NAICS CODE: 325998 All Other Miscellaneous Chemical Product and Preparation Manufacturing
- Suggested ISO General Liability Code(s): 52876
- Suggested Workers Compensation Code(s): 4771
Description for 2899: Chemicals And Chemical Preparations, Not Elsewhere Classified
Division D: Manufacturing | Major Group 28: Chemicals And Allied Products | Industry Group 289: Miscellaneous Chemical Products
2899 Chemicals And Chemical Preparations, Not Elsewhere Classified: Establishments primarily engaged in manufacturing miscellaneous chemical preparations, not elsewhere classified, such as fatty acids, essential oils, gelatin (except vegetable), sizes, bluing, laundry sours, writing and stamp pad ink, industrial compounds, such as boiler and heat insulating compounds, metal, oil, and water-treating compounds, waterproofing compounds, and chemical supplies for foundries. Establishments primarily engaged in manufacturing vegetable gelatin (agar-agar) are classified in Industry 2833; those manufacturing dessert preparations based on gelatin are classified in Industry 2099; those manufacturing printing ink are classified in Industry 2893; and those manufacturing drawing ink are classified in Industry 3952.
- Acid resist for etching
- Acid, battery
- Anise oil
- Antifreeze compounds, except industrial alcohol
- Bay oil
- Binders (chemical foundry supplies)
- Boiler compounds, antiscaling
- Bombs, flashlight
- Caps, for toy pistols
- Carbon removing solvents
- Chemical cotton (processed cotton linters)
- Chemical supplies for foundries
- Citronella oil
- Concrete curing compounds (blends of pigments, waxes, and resins)
- Concrete hardening compounds
- Core oil and binders
- Core wash
- Core was
- Correction fluid
- Corrosion preventive lubricant, synthetic base: for jet engines
- Deicing fluid
- Desalter kits, sea water
- Dextrine sizes
- Drilling mud
- Dyes, household
- Essential oils
- Ethylene glycol antifreeze preparations
- Eucalyptus oil
- Esothermics for metal industries
- Facings (chemical foundry supplies)
- Fatty acids: margaric, oleic, and stearic
- Fire extinguisher charges
- Fire retardant chemical preparations
- Fluidifier (retarder) for concrete
- Fluorescent inspection oil
- Fluxes: brazing, soldering, galvanizing, and welding
- Foam charge mixtures
- Food contamination testing and screening kits
- Foundry supplies, chemical preparations
- Fuel tank and engine cleaning chemicals, automotive and aircraft
- Fusees: highway, marine, and railroad
- Gelatin capsules, empty
- Gelatin: edible, technical, photographic, and pharmaceutical
- Glue size
- Grapefruit oil
- Grouting material (concrete mending compound)
- Gum sizes
- Gun slushing compounds
- Heat insulating compounds
- Heat treating salts
- Hydrofluoric acid compound, for etching and polishing glass
- Igniter grains, boron potassium nitrate
- Industrial sizes
- Insulating compounds
- Jet fuel igniters
- Laundry sours
- Lemon oil
- Lighter fluid
- Magnetic inspection oil and powder
- Margaric acid
- Metal drawing compound lubricants
- Metal treating compounds
- Military pyrotechnics
- Oil treating compounds
- Oleic acid (red oil)
- Orange oil
- Orris oil
- Oxidizers, inorganic
- Packers' salt
- Parting compounds (chemical foundry supplies)
- Patching plaster, household
- Penetrants, inspection
- Peppermint oil
- Plating compounds
- Pyrotechnic ammunition: flares, signals, flashlight bombs, and rockets
- Railroad torpedoes
- Red oil (oleic acid)
- Rifle bore cleaning compounds
- Rosin sizes
- Rubber processing preparations
- Rust resisting compounds
- Signal flares, marine
- Sizes: animal, vegetable, and synthetic plastics materials
- Sodium chloride, refined
- Soil testing kits
- Spearmint oil
- Spirit duplicating fluid
- Stearic acid
- Stencil correction compounds
- Tints and dyes, household
- Torches (fireworks)
- Vegetable oils, vulcanized or sulfurized
- Water treating compounds
- Water, distilled
- Waterproofing compounds
- Wintergreen oil
- Wood, plastic
- Writing ink and fluids
Fireworks Manufacturers Insurance - The Bottom Line
Fireworks manufacturers insurance policies come with different coverages, costs and exclusions. To see if your fireworks manufacturing company has the best fit insurance policies for your operation - 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.
Types Of Small Business Insurance - Requirements & Regulations
Perhaps you have the next great idea for a product or service that you know will appeal to your local area. If you've got a business, you've got risks. Unexpected events and lawsuits can wipe out a business quickly, wasting all the time and money you've invested.
Operating a business is challenging enough without having to worry about suffering a significant financial loss due to unforeseen and unplanned circumstances. Small business insurance can protect your company from some of the more common losses experienced by business owners, such as property damage, business interruption, theft, liability, and employee injury.
Purchasing the appropriate commercial insurance coverage can make the difference between going out of business after a loss or recovering with minimal business interruption and financial impairment to your company's operations.
Insurance is so important to proper business function that both federal governments and state governments require companies to carry certain types. Thus, being properly insured also helps you protect your company by protecting it from government fines and penalties.
Small Business Insurance Information
In the business world, there are many risks faced by company's every day. The best way that business owners can protect themselves from these perils is by carrying the right insurance coverage.
The The National Association of Insurance Commissioners (NAIC) is the U.S. standard-setting and regulatory support organization. Through the NAIC, state insurance regulators establish standards and best practices, conduct peer review, and coordinate their regulatory oversight.
Commercial insurance is particularly important for small business owners, as they stand to lose a lot more. Should a situation arise - a lawsuit, property damage, theft, etc. - small business owners could end up facing serious financial turmoil.
According to the SBA, having the right insurance plan in place can help you avoid major pitfalls. Your business insurance should offer coverage for all of your assets. It should also include liability and casual coverage.
Types Of Small Business Insurance
Choosing the right type of coverage is absolutely vital. You've got plenty of options. Some you'll need. Some you won't. You should know what's available. Once you look over your options you'll need to conduct a thorough risk assessment. As you evaluate each type of insurance, ask yourself:
- What type of business am I running?
- What are common risks associated with this industry?
- Does this type of insurance cover a situation that could feasibly arise during the normal course of doing business?
- Does my state require me to carry this type of insurance?
- Does my lender or do any of my investors require me to carry this type of policy?
A licensed insurance agent or broker in your state can help you determine what kinds of coverages are prudent for your business types. If you find one licensed to sell multiple policies from multiple companies (independent agents) that person can often help you get the best insurance rates, too. Following is some information on some of the most common small business insurance policies:
|Business Insurance Policy Type||What Is Covered?|
|General Liability Insurance||What is covered under commercial general liability insurance? It steps in to pay claims when you lose a lawsuit with an injured customer, employee, or vendor. The injury could be physical, or it could be a financial loss based on advertising practices.|
|Workers Compensation Insurance||What is covered under workers compensation insurance? This type of insurance protects a business and its owner(s) from claims by employees who suffer a work-related injury, illness or disease. Workers comp typically provides the injured employee with benefits to cover medical expenses, a portion of his/her lost wages, rehabilitation costs if applicable, and permanent partial or permanent total disability.|
|Product Liability Insurance||What is covered under product liability insurance? I pays an injured party's settlement or lawsuit claim arising from a defective product. These are usually caused by design defects, manufacturing defects, or a failure to provide adequate warning or instructions as to how to safely use the product.|
|Commercial Property Insurance||What is covered under business property insurance? General liability policies don't cover damages to your business property. That's what commercial property insurance is for. It protects all of the physical parts of your business: your building, your inventory, and your equipment, giving you the funds you need to replace them in the event of a disaster. If you work from home, you might consider a Home Based Business Insurance policy instead.|
|Business Owners Policy (BOP)||What is covered under a business owners policy (BOP)? This is a policy designed for small, low-risk businesses. It simplifies the basic insurance purchase process by combining general liability policies with business income and commercial property insurance.|
|Commercial Auto Insurance||What is covered under business auto insurance? This type of insurance covers automobiles being used for business purposes. This could include a fleet of business-only vehicles or a single company car. In some cases it might cover your car or your employee's car while they're being used for business. These policies have much higher limits, ensuring you can cover your costs if one of these vehicles gets into an accident.|
|Commercial Umbrella Policies||What is covered under commercial umbrella insurance? This type of policy is a sort of "gap" insurance. It covers your liability in the event that a court verdict or settlement exceeds your general liability policy limits.|
|Liquor Liability Insurance||What is covered under liquor liability insurance? It covers bodily injury or property damage caused by an intoxicated person who was served liquor by the policy holder.|
|Professional Liability (Errors & Omissions)||What is covered under professional liability insurance? This type of business insurance is also known as malpractice oe E&O. It covers the damages that can arise from major mistakes, especially in high-stakes professions where mistakes can be devastating.|
|Surety Bond||What is covered under surety bonds? Bonding is a contract where one party, the SURETY (who assures the obligee that the principal can perform the task), guarantees the performance of certain obligations of a second party, the PRINCIPAL (the contractor or business who will perform the contractual obligation), to a third party, the OBLIGEE (the project owner who is the recipient of an obligation).|
Who Needs General Liability Insurance? - Virtually every business. A single lawsuit or settlement could bankrupt your business five times over. You might also need this policy to win business. Many companies and government agencies won't do business with your company until you can produce proof that you've obtained one of these policies.
Business Insurance Required by Law
If you have any employees most states will require you to carry worker's compensation and unemployment insurance. Some states require you to insure yourself even if you are the only employee working in the business.
Your insurance agent can help you check applicable state laws so you can bring your business into compliance.
Other Types Of Small Business Insurance
There are dozens of other, more specialized forms of small business insurance capable of covering specific problems and risks. These forms of insurance include:
- Business Interruption Insurance
- Commercial Flood Insurance
- Contractor's Insurance
- Cyber Liability
- Data Breach
- Directors and Officers
- Employment Practices Liability
- Environmental or Pollution Liability
- Management Liability
- Sexual Misconduct Liability
Whether you need any or all of these policies will depend on the results of your risk assessment. For example, you probably don't need an environmental or pollution policy if you're running an IT company out of a leased office, but you would need data breach and cyber liability policies to fully protect your business.
Also learn about small business insurance requirements for general liability, business property, commercial auto & workers compensation including small business commercial insurance costs. Call us (855) 767-7828.
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.
- Audio & Video Equipment
- Auto Parts
- Brooms & Brushes
- Camping Equipment
- Canned Fruit & Vegetables
- Canvas Products
- CBD Oil And Hemp
- Clock & Watch
- Commercial Air Conditioning
- Commercial Electronics
- Communications Equipment
- Construction Equipment
- Cork Products
- Down And Feather Products
- Dry Ice
- Dyes & Pigments
- Electronic Toys & Games
- Exercise Equipment
- Farm Equipment
- Feed & Grain
- Fur Garment
- Garage Door
- Gypsum Products
- Iron & Steel Foundries
- Lawn Mowers
- Leather Apparel
- Lighting & Wiring
- Lumber & Wood Products
- Machine Shop
- Major Electrical Appliances
- Marijuana Products
- Mattresses & Box Springs
- Metal & Plastic Furniture
- Metal Heat Treating
- Metal Toys
- Musical Instruments
- Nonferrous Foundries
- Ornamental Metalwork
- Paper & Allied Products
- Pet Food
- Plastic & Rubber Toys
- Plastic Goods
- Plastics Molding, Forming & Extruding
- Product Liability
- Pulp & Paper Mills
- Residential Air Conditioning & Heating
- Rubber Goods
- Sawmills & Planing Mills
- Screw Machine Products
- Sheet Metal
- Soap & Detergent
- Small Electrical Appliances
- Sporting Goods
- Stone Products
- Textiles Finishing & Coating
- Tool & Die Shops
- Vending Machines
- Wire Rope
- Wood Furniture
- Writing Instruments
For manufacturers, having the proper coverage is very important. You will need Products/Completed Operations Liability Coverage to protect you against injuries or property damage cause my the products you make or sell.
Manufacturing is an extremely broad category that includes countless potential hazards and exposures in virtually all coverage areas. Because of this, every individual manufacturer is unique and a specific risk survey of every operation is advisable.
The basic insurance needs for every class of business or operation includes property coverage for buildings, machinery and equipment, as well as for raw stock and finished products.
Liability insurance for premises exposures is important but products liability insurance presents greater concerns so these exposures and coverage needs must be evaluated carefully.
In addition, protection for injuries to workers, environmental coverages and automobile insurance are priority items.
What does the insured does that could result in a covered loss? The insuring agreement only requires that the insured be legally obligated to pay damages for injury to others or damage to their property included within the products-completed operations hazard covered by the insurance.
Because of this, every product manufactured and completed operation exposure for each named insured must be determined, described and evaluated to be certain that each represents acceptable exposures, or are acceptable classes of business to the insurance company providing coverage.
Once the extent of all business activities and operations is determined, the process of identifying hazards begins. The first step in the process is completely listing and describing all current products being manufactured and projects being worked on.
The next step is obtaining the same information for discontinued products and completed projects for the past five to 10 years, depending on the products or projects involved. This should include an explanation of why the products were discontinued. If some completed projects were of a different type than those currently being worked on, an explanation is in order, including whether the insured may resume them in the future.
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.