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Gear Manufacturers Insurance Policy Information

Gear Manufacturers Insurance

Gear Manufacturers Insurance. Gears, or cogs, have been used for centuries. Gears are designed to amplify force, and, as such, have a wide use in a number of industries.

Motor engines, construction, conveyor belts, different types of transportation, clocks, or even, for instance, microwave ovens wouldn't be able to function if it weren't for gears.

Gear manufacturers produce gears for agricultural and industrial machinery, aircraft, vehicles, and watercraft. While most gears are made of metal, particularly brass, iron, or steel, others are made of plastic.

Smaller gears can be produced by extrusion in which a rod of heated steel or other metal is forced through a gear-shaped die, and then cut to the proper thickness.

Larger gears are typically forged into "blanks" which are then machined to cut the teeth. Forging applies high-pressure to force cold or heated metal into a special mold called a die. Blanks may be ground, cut, polished, deburred, heat treated or otherwise tempered.

Coatings may be added by electroplating or similar processes. Other operations may include welding or spray-painting.

A variety of types of gears exist, depending on their intended use; spur, helical, double helical, worm, crown, spiral, bevel, magnetic… Each kind of hear has a specific use.

The market size of this industry in the United States is $4 billion, and in this country, approximately 250 companies employ 12,500 workers in gear manufacturing. This industry's revenue is expected to grow in the next five years, but as in every field, companies that make gears also face a number of risks.

Having the right gear manufacturers insurance is crucial in protecting your interests, so let's examine what types of insurance you might need.

Gear 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 gear manufacturing insurance questions:

What Is Gear Manufacturers Insurance?

Gear manufacturers insurance is a type of insurance coverage that is specifically designed for companies that manufacture gears and related machinery components.

It provides protection against various risks and liabilities associated with the production and sale of gears, including property damage, product liability, and workers' compensation. The coverage can also include protection for business interruption, cyber liability, and environmental liability.

The insurance policy is tailored to meet the specific needs of gear manufacturers and is designed to help protect their assets and operations from financial losses due to unexpected events.

How Much Does Gear Manufacturers Insurance Cost?

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

Why Do Gear Manufacturers Need Insurance?

Insurance For Manufacturers

No matter how competent your management team is, circumstances beyond your control always threaten to cause financial devastation. Despite risk mitigation, you cannot prevent events such as earthquakes, floods, hurricanes, lightning strikes, or wildfires. Vandalism and theft are also a constant threat to any business.

On the other hand, gear production comes with risks that are specific to the industry itself as well. Gear manufacturing requires numerous machines, which can break down or cause work-related injuries in workers. The fact that gear manufacture relies on a number of electronic devices further means that fire hazard is always present.

Certain risks can be avoided, if safety procedures are followed, but others cannot. The financial blows resulting from any of these, or other, catastrophic events might be devastating, and even cause bankruptcy.

That is why no company should forego the step of buying the right gear manufacturers insurance.

What Type Of Insurance Do Gear Manufacturers Need?

While some risks are universal, meaning they could affect any company, each line of work is specific, and each company is unique in its needs and demands. Even the terrain, or climate, in the vicinity of your facility can affect the type of gear manufacturers insurance you might need.

That is why it is crucial to consult a commercial insurance agent and discuss all details relevant to your insurance requirements including, for instance, your number of employees, the amount and type of gears you produce, and even the amount of rain the place in which your facility is based experiences each year.

Having said that, some types of insurance are going to be necessary for any gear manufacturer. These include:

  • Commercial General Liability: In the case your company's activities cause damage to the property of any third party (such as machines you rent, or the building of another manufacturer in the vicinity), this type of insurance will shield you from the resulting cost. It also covers cases of third party bodily injury; scenarios in which a contractor sustains an accident on your premises, for example.
  • Commercial Property: This type of insurance protects your company from financial losses resulting from damage to your physical property. This includes both damage caused by natural disasters, such as floods, wildfires, or earthquakes, and damage caused by vandalism or theft.
  • Product Liability: This type of gear manufacturers insurance protects your company from bodily injury and property damage liability specifically caused by your product, in the event that it malfunctions. It also covers financial loss in case you need to recall your product.
  • Workers Compensation: Gear production requires a lot of machinery, and your workers are at risk of work-related injuries. This type of insurance will cover both the medical expenses and any lost income, in the case of unfortunate events.

Gears are a crucial part of virtually all machines, and as such, will always be needed in a number of different industries. That is why investing in this line of work is a good idea, especially because this type of business is expected to grow in the years to come.

However, even the tiniest mishap could set you back, or even cause such devastating damage that you might be forced to close your company.

That is why it is of utmost importance to protect your company. Gear manufacturers insurance is the plan B each serious company needs.

Gear Manufacturing's Risks & Exposures


Premises liability exposure is normally low due to lack of public access. If tours are given, visitors may be injured by slips, trips, or falls. Fumes, dust, and noise from operations could affect neighboring properties.

Products liability exposure can be high because of the pressure and intensity at which gears operate. If not tempered properly, gears in industrial machinery can fail or shatter in use, sending parts flying throughout a plant, injuring workers and causing property damage. Failure of custom gears for critical parts could cause major shutdowns, with extensive lost time claims.

Failure of gears used in operating parts or safety components in aircraft, watercraft, or vehicles can result in severe injury to passengers. 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 item in a run).

Warning labels regarding dangers of personal injury are important, but provide only limited defense, especially in the case of inherently dangerous products.

Older gears made before improved safety features were introduced may still be in use.

Environmental impairment exposure may be significant due to possible contamination of ground, air, and water from the alloys, paints, and solvents used. Disposal of wastes must adhere to all federal and state guidelines.

Workers compensation exposures are moderate to high. Injuries from production machinery are common, as are minor cuts, burns from chemicals and heat-producing operations, slips, trips, falls, foreign objects in the eye, hearing impairment from noise, back injuries from lifting, and repetitive motion losses. Machinery operators are exposed to injury from severe cuts, crushed limbs, and amputations.

Exposure to dust, spray-painting, or solvents can result in skin, eye, and lung irritation. Workstations should be ergonomically designed. Employees should be provided with safety training and protective equipment.

Quality control and testing can be dangerous if a gear has not been properly tempered. Testing areas should be protected to prevent parts from flying throughout the plant.

Property exposures consist of an office, production plant, and warehouse for storage of raw materials or finished goods. Ignition sources include electrical wiring, heating systems, production machinery, molten metal, hot forging, and sparks from welding or electroplating.

The exposure is lessened if the manufacturer outsources some of these operations. When outsourcing is used, adequate coverage for the off premises property or inland marine coverage should be obtained.

Lubricants, solvents, or degreasers may be flammable, and should be properly stored away from combustibles. Spray-painting operations can cause fire unless they are carried out in spray booths with explosion-proof electrical components. The use of dip tanks instead of spray booths may require special attention. Welding should be done away from combustibles.

Poor housekeeping may be a serious fire hazard. Unless disposed of properly, greasy, oily rags (such as those used to clean the machinery) can cause a fire without a separate ignition source. While stock is not usually susceptible to fire or water damage, some gears may be target items for theft.

Appropriate security controls should be taken including 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, electrical control panels and other apparatus. A lengthy breakdown to production machinery could result in severe loss, both direct and under time element.

Crime exposures are chiefly 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. The manufacturer should have 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, installation, and valuable papers and records for customers' and suppliers' information. Stock in transit may be susceptible to damage from collision, overturn, fire and theft. As some gears may be oversized, drivers should be trained in loading, tie-down, and unloading.

Commercial auto exposure can be high if the manufacturer picks up raw materials, transports components between different plants, or delivers finished goods to customers. Transportation of oversized industrial gears requires careful loading and tie-down to prevent items from coming loose and toppling over during 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.

What Does Gear Manufacturers Insurance Cover & Pay For?

Gear Manufacturers Insurance Claim Form

Gear manufacturers, like any business, can face a variety of lawsuits. Some of the most common reasons include product liability, negligence, breach of warranty, and intellectual property infringement. Insurance policies provide a safety net for such unforeseen legal issues. Let's look at each scenario and how insurance can help.

1. Product Liability: This occurs when a manufactured gear is faulty or leads to accidents or damage. For instance, if a gear used in an automobile fails and results in a car crash, the gear manufacturer could be sued for product liability. In such cases, Product Liability Insurance can help the manufacturer. This insurance covers legal costs associated with the lawsuit, any medical payments if a person is injured due to the product, and damages if the company is found liable.

2. Negligence: Negligence claims are made when a company fails to demonstrate the level of care that a reasonable entity would in the same situation. If, for example, a gear manufacturer disregards quality control measures resulting in a defective product, they could be sued for negligence. Professional Indemnity Insurance (also known as Errors and Omissions Insurance) can cover the legal costs, settlements, and any awarded damages in such a case.

3. Breach of Warranty: If a gear manufacturer fails to fulfill the terms of a warranty or guarantee, they could be sued for breach of warranty. For example, if a gear is guaranteed to last for a certain period or meet specific performance metrics and it doesn't, the customer could take legal action. In such situations, Commercial General Liability Insurance can provide coverage for the legal fees, court costs, and any financial losses related to the lawsuit.

4. Intellectual Property Infringement: This occurs when a gear manufacturer unlawfully uses another company's patented design or technology. If sued for intellectual property infringement, Intellectual Property Insurance can protect the manufacturer. It covers the legal defense costs and any settlements or damages awarded to the plaintiff.

It's important to note that the specifics of what is covered can vary depending on the insurance policy and provider. Therefore, gear manufacturers should carefully review policy terms and conditions and consider consulting with an insurance professional or legal counsel to ensure they have adequate coverage for their specific risks.

Commercial Insurance And Business Industry Classification

Description for 3566: Speed Changers, Industrial High-Speed Drives, And Gears

Division D: Manufacturing | Major Group 35: Industrial And Commercial Machinery And Computer Equipment | Industry Group 356: General Industrial Machinery And Equipment

3566 Speed Changers, Industrial High-Speed Drives, And Gears: Establishments primarily engaged in manufacturing speed changers, industrial high-speed drives, except hydrostatic drives, and gears. Establishments primarily engaged in manufacturing automotive power transmission equipment are classified in Industry 3714; those manufacturing aircraft power transmission equipment are classified in Industry 3728; and those manufacturing industrial hydrostatic drives (transmissions) are classified in Industry 3594.

  • Drives, high-speed industrial: except hydrostatic Gearmotors (power transmission equipment) Gears, power transmission: except motor vehicle and aircraft Reducers, speed Reduction gears and gear units for turbines, except automotive and Speed changers (power transmission equipment) Speed reducers (power transmission equipment) Torque converters, except motor vehicle

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 3728: Aircraft Parts And Auxiliary Equipment, Not Elsewhere Classified

Division D: Manufacturing | Major Group 37: Transportation Equipment | Industry Group 372: Aircraft And Parts

3728 Aircraft Parts And Auxiliary Equipment, Not Elsewhere Classified: Establishments primarily engaged in manufacturing aircraft parts and auxiliary equipment, not elsewhere classified. This industry also includes establishments owned by manufacturers of aircraft parts and auxiliary equipment and primarily engaged in research and development on aircraft parts, whether from enterprise funds or on a contract or fee basis. Establishments primarily engaged in manufacturing or assembling complete aircraft are classified in Industry 3721; those manufacturing aircraft engines and parts are classified in Industry 3724; those manufacturing aeronautical instruments are classified in Industry 3812; those manufacturing aircraft engine electrical (aeronautical electrical) equipment are classified in Industry 3694; and those manufacturing guided missile and space vehicle parts and auxiliary equipment are classified in Industry 3769. Establishments not owned by manufacturers of aircraft parts but primarily engaged in research and development on aircraft parts on a contract or fee basis are classified in Services, Industry 8731.

  • Adapter assemblies, hydromatic propeller
  • Ailerons, aircraft
  • Aircraft armament, except guns
  • Aircraft arresting device system
  • Aircraft assemblies, subĂ„assemblies, and parts, except engines
  • Aircraft body assemblies and parts
  • Aircraft power transmission equipment
  • Aircraft propeller parts
  • Airframe assemblies, except for guided missiles
  • Airplane brake expanders
  • Alighting assemblies (landing gear), aircraft Beaching gear, aircraft
  • Blades, aircraft propeller: metal or wood
  • Bomb racks, aircraft
  • Brakes, aircraft
  • Chaffing dispensers, aircraft
  • Countermeasure dispensers, aircraft
  • Deicing equipment, aircraft
  • Dive brakes, aircraft
  • Dusting and spraying equipment, aircraft
  • Dynetric balancing stands, aircraft
  • Elevators, aircraft
  • Empennage (tail) assemblies and parts aircraft
  • Fins, aircraft
  • Flaps, aircraft wing
  • Fuel tanks, aircraft: including self-sealing
  • Fuselage assemblies, aircraft
  • Gears, power transmission: aircraft
  • Governors, aircraft propeller feathering
  • Hubs, aircraft propeller
  • Instrument panel mockups: aircraft training units
  • Landing gear, aircraft
  • Landing skis and tracks, aircraft
  • Link trainers (aircraft training mechanisms)
  • Nacelles, aircraft
  • Oleo struts, aircraft
  • Oxygen systems for aircraft
  • Panel assemblies (hydromatic propeller test stands), aircraft
  • Pontoons, aircraft
  • Propeller alining tables
  • Propellers, variable and fixed pitch and parts-aircraft
  • Pumps, propeller feathering
  • Refueling equipment, airplane: for use in night
  • Research and development on aircraft parts and auxiliary equipment
  • Roto-blades for helicopters
  • Rudders, aircraft
  • Seat ejector devices, aircraft
  • Spinners, aircraft propeller
  • Stabilizers, aircraft
  • Target drones, aircraft
  • Targets, trailer type: aircraft
  • Tow targets, aircraft
  • Training aids, aircraft: except electronic
  • Transmissions, aircraft
  • Turret test fixtures, aircraft
  • Turrets and turret drives, aircraft
  • Wheels, aircraft
  • Wing assemblies and parts, aircraft

Description for 3751: Motorcycles, Bicycles, And Parts

Division D: Manufacturing | Major Group 37: Transportation Equipment | Industry Group 375: Motorcycles, Bicycles, And Parts

3751 Motorcycles, Bicycles, And Parts: Establishments primarily engaged in manufacturing motorcycles, bicycles, and similar equipment, and parts. Establishments primarily engaged in manufacturing children's vehicles, except bicycles, are classified in Industry 3944. Establishments primarily engaged in manufacturing golf carts and other similar personnel carriers are classified in Industry 3799.

  • Bicycles and parts
  • Brakes, bicycle: friction clutch and other
  • Frames, motorcycle and bicycle
  • Gears, motorcycle and bicycle
  • Handle bars, motorcycle and bicycle
  • Mopeds and parts
  • Motor scooters and parts
  • Motorbikes and parts
  • Motorcycles and parts
  • Saddles, motorcycle and bicycle
  • Seat posts, motorcycle and bicycle

Gear Manufacturers Insurance - The Bottom Line

Gear manufacturers insurance policies differ in coverage, exclusions and premiums. To see if your gear manufacturing operation 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.

Manufacturing Insurance

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.

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