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Plastics Manufacturers Insurance Policy Information

Plastics Manufacturers Insurance

Plastics Manufacturers Insurance. Plastics unquestionably play a vital role in today's world. From electrical appliances to computers, and from toys to plumbing applications, over 45 distinct types of plastic are used in a multitude of industrial and residential products.

Plastics manufacturers produce malleable pellets or sheets from raw materials and sell their products to fabricators who convert these into a wide variety of commercial and domestic goods.

The raw materials are chiefly ethylene and propane which are refined from crude oil, then heated and combined with a catalyst to create several types of polymer in liquid or powdered form. The polymers may be combined with each other or with additives before being formed into pellets or extruded into sheets and cooled by water or air.

Before companies that manufacture plastic end products are able to carry out their activities, plastics manufacturers produce malleable plastic pellets or sheets that can then be incorporated into a breathtaking variety of end products.

On an annual basis, these plastics manufacturers process over 300 million tons of plastic, making this industry an extremely profitable one. Like manufacturers within other branches of industry they are also, however, vulnerable to a broad spectrum of risks.

Any unforeseen event has the potential to wreak financial havoc that can, in the worst cases, lead to bankruptcy. What types of plastics manufacturers insurance might companies in this industry need to protect their business interests from major perils? Read on to learn more.

Plastics 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 plastics manufacturing insurance questions:

What Is Plastics Manufacturers Insurance?

Plastics Manufacturers Insurance is a type of insurance coverage designed specifically for businesses involved in the manufacture, processing, or distribution of plastic products. This insurance provides protection for the business in the event of property damage, liability claims, and business interruption due to an accident or other unexpected event.

The coverage may include protection for products liability, property damage, workers compensation, and general liability. This insurance is important for plastics manufacturers because the industry involves many potential hazards, such as chemical spills, fire, or equipment breakdowns, which could lead to significant losses for the business.

How Much Does Plastics Manufacturers Insurance Cost?

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

Why Do Plastics Manufacturers Need Insurance?

Insurance For Manufacturers

Companies that make plastic pellets and sheets will do everything they can to run a smooth and effective operation while mitigating the risks they face. Despite these efforts, accidents and other circumstances beyond a company's control may still impact their business.

Acts of nature - including, for instance, earthquakes, serious floods or storms, lightning strikes, and hurricanes - can strike any company. These events cannot be prevented and often hit with very little warning, after which they can severely damage not just a company's physical building but also everything inside it.

Theft and vandalism likewise have the potential to deal serious financial blows, and even the sudden breakdown of essential industrial equipment has to be considered. Plastics manufacturers additionally have a high fire risk.

Plastics manufacturers also face liability risks. Employees may become injured while operating heavy machinery, or suffer occupational illnesses resulting from numerous causes, including non-ergonomic working environments. Third parties might get into an accident on a company's premises, or an environmental leak or spill could lead to drawn-out litigation.

Firms in this industry need plastics manufacturers insurance coverage for the simple reason that these threats can never be completely prevented - and just one major peril can have devastating financial consequences.

When a manufacturer is properly insured, however, it will be much easier to recover from any loss.

What Type Of Insurance Do Plastics Manufacturers Need?

Because the right insurance coverage can easily make the difference between continued commercial success and bankruptcy, it is vital to carefully consider your insurance needs.

Consulting a reputable commercial insurance agent is the best way to do this, as they can guide you through the process of purchasing the coverage you need. The insurance a company will need to carry depends on factors such as the location of their facility, the raw materials they process, the value of their industrial equipment, and their number of workers.

They will, however, certainly require the following types of plastics manufacturers insurance:

  • Commercial Property: Intended to protect a company from financial losses in the event of property damage or loss caused by perils such as vandalism, theft, and acts of nature, this type of insurance covers your physical building as well as the assets inside.
  • Commercial General Liability: Should a third party file a claim alleging property damage or bodily injury, which either took place on your premises or resulted from your company's activities, commercial general liability insurance is likely to cover the legal costs that follow.
  • Product Liability: This type of plastics manufacturers insurance insurance covers bodily injury and property damage claims resulting directly from exposure to a product you manufactured. It helps cover attorney fees and settlement costs.
  • Workers Compensation: In case an employee suffers a work-related injury or illness, this kind of insurance coverage funds their medical costs. If the employee cannot return to work for a time, their lost wages are also reimbursed.
  • Commercial Auto: Any company that uses vehicles for commercial purposes will further require commercial auto insurance, which covers perils ranging from vehicle damage to driver injuries.

Bear in mind that these types of insurance are merely examples of the coverage a plastics manufacturer is going to need to protect their business from perils.

A commercial insurance broker who is familiar with the nature of your company is best suited to guide you through the process of obtaining the plastics manufacturers insurance that will allow your business to thrive in the face of any adversity.

Plastics Manufacturing's Risks & Exposures


Premises liability exposures at the plant are normally low as access by visitors is limited. If tours are given or if outsiders are allowed on premises, visitors may be injured by slips, trips, or falls. Raw materials and chemicals used in processing may be corrosive and/or toxic.

Fumes, dust, and noise from production could affect neighbors. Should a fire occur, the difficulty in extinguishing it could result in the release of toxins plus smoke damage to neighboring properties.

Evacuation plans should be on file with the fire department. The storage of raw materials or finished goods outdoors can create an attractive nuisance.

Products liability exposure is low as the product is being shipped to manufacturers who produce the finished goods. Quality control is very important. If a customer orders a particular type of plastic, such as with fire retardant qualities, it must meet all specifications or the end product may not function as planned.

Environmental impairment exposure is high due to possible contamination of ground, air, and water from raw chemicals, solvents, and fuels. The raw materials are flammable and may be toxic.

The catalysts may be caustic, and the final product is usually not biodegradable. Disposal procedures must adhere to all EPA and other regulatory standards.

Workers compensation exposures are very high. Injuries from production machinery are common, as are minor cuts, puncture wounds, burns, slips, trips, falls, foreign objects in the eye, back injuries from lifting, hearing loss from noise, and repetitive motion losses. More serious hazards come from chemical usage that can cause injury to eyes, skin, and lungs.

Workers should be made aware of potential problems and may need periodic monitoring for cumulative exposure. Employees should be provided with safety training and protective equipment. Workstations should be ergonomically designed. Areas that generate dust require respiratory protection devices, as well as eye protection and eye wash stations.

The high volume required for production schedules may lead workers to remove guards on the machinery, or to postpone maintenance and repair. If there is a fire on premises, the fumes in the smoke are very dangerous and can cause severe respiratory distress.

Ventilation systems are needed to prevent the buildup of toxic vapors. Dense smoke makes egress from the premises difficult.

Property exposure consists of an office, production plant, and a warehouse for storage of raw materials and finished products. Ignition sources include electrical wiring, heating systems, production machinery, buildup of static electricity, and dust explosions.

If the stock catches fire, it can be very difficult to extinguish and will cause a great deal of smoke damage. Molten plastic can carry the fire great distances and into crevices. The chemicals must be adequately controlled, separated, and stored. Nearly all aspects of the operation present fire hazards that can only be minimized by separation and fire suppression systems.

Machinery needs proper maintenance to prevent overheating and wear. Fuel sources to run machinery and to heat the plant must be adequately controlled. Poor housekeeping 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.

Equipment breakdown exposures include malfunctioning production equipment and 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 exposure comes from employee dishonesty. 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.

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. The main perils are collision, upset, fire, or theft. There may be contractors' equipment such as forklifts or heavier equipment used to move raw materials and finished goods.

Commercial auto exposure is high if the manufacturer assumes responsibility for the transport of raw materials or finished products. If raw chemicals are transported, potential contamination due to overturn or spillage is high. Transporting the final product is less hazardous unless there is a fire.

Hazards are substantially higher without proper controls, including any required Hazardous Material licenses and spill containment procedures and equipment. 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 Plastics Manufacturers Insurance Cover & Pay For?

Plastics Manufacturers Insurance Claim Form

Plastic manufacturers can face lawsuits for several reasons. Here are some common scenarios where they might be sued, along with the types of insurance that could help protect them:

Product Liability: This is one of the most common reasons for lawsuits in manufacturing. If a plastic product fails, causes harm, or doesn't meet the standards or expectations set out by the customer or regulatory bodies, the manufacturer may be sued. For instance, a plastic toy could break, leading to a child's injury, or a plastic component in a medical device could malfunction, leading to patient harm. In such cases, Product Liability Insurance can help. This insurance can cover the costs of legal defense, settlements, and any awarded damages, helping the manufacturer to cope with the financial burden of such lawsuits.

Workplace Accidents: Manufacturing environments can be hazardous, and accidents can happen, leading to employee injuries. When an employee gets injured on the job, they might sue the employer for negligence. Here, Workers Compensation Insurance can provide coverage. This insurance can help pay for the medical bills of the injured employee, any disability benefits they are due, and even the legal costs if the employee sues the company.

Environmental Damage: Plastic manufacturing processes can sometimes result in environmental damage, such as pollution or improper waste disposal. If a company is found to be responsible for such damage, it could face legal action from regulatory bodies, local communities, or environmental organizations. Environmental Liability Insurance can help protect against these risks. This insurance can cover cleanup costs, fines, and legal fees associated with environmental lawsuits.

Property Damage: Fires, natural disasters, or other incidents can cause significant damage to a plastic manufacturer's property, including buildings, machinery, and inventory. If a third party, such as a contractor or a neighboring business, suffers damage due to such an incident, they could sue the manufacturer. Commercial Property Insurance can cover the cost of repairing or replacing the damaged property, and Commercial General Liability Insurance can cover the legal costs and any damages awarded in a lawsuit.

Intellectual Property Infringement: If a plastic manufacturer is accused of infringing on another company's patents, copyrights, or trademarks, they could be sued. In this case, Intellectual Property Insurance can help. This insurance can cover the costs of legal defense and any settlements or damages awarded by the court.

Overall, insurance plays a crucial role in managing the risks associated with plastic manufacturing. By having the right types and amounts of coverage, a manufacturer can protect their financial stability and ensure their operations can continue even in the face of potential lawsuits.

Commercial Insurance And Business Industry Classification

Description for 2821: Plastics Material, Synthetic And Resins, and Nonvulcanizable Elastomers

Division D: Manufacturing | Major Group 28: Chemicals And Allied Products | Industry Group 282: Plastics Materials And Synthetic Resins, Synthetic

2821 Plastics Material, Synthetic And Resins, and Nonvulcanizable Elastomers: Establishments primarily engaged in manufacturing synthetic resins, plastics materials, and nonvulcanizable elastomers. Important products of this industry include: cellulose plastics materials; phenolic and other tar acid resins; urea and melamine resins; vinyl resins; styrene resins; alkyd resins; acrylic resins; polyethylene resins; polypropylene resins; rosin modified resins; coumarone-indene and petroleum polymer resins; miscellaneous resins, including polyamide resins, silicones, polyisobutylenes, polyesters, polycarbonate resins, acetal resins, and fluorohydrocarbon resins; and casein plastics. Establishments primarily engaged in manufacturing fabricated plastics products or plastics film, sheet, rod, non-textile monofilaments and regenerated cellulose products, and vulcanized fiber are classified in Industry Group 308, whether from purchased resins or from resins produced in the same plant. Establishments primarily engaged in compounding purchased resins are classified in Industry 3087. Establishments primarily manufacturing adhesives are classified in Industry 2891.

  • Acetal resins
  • Acetate cellulose (plastics)
  • Acrylic resins
  • Acrylonitrile-butadiene-styrene resins
  • Alcohol resins, polyvinyl
  • Alkyd resins
  • Allyl resins
  • Butadiene copolymers, containing less than 50 percent butadiene
  • Carbohydrate plastics
  • Casein plastics
  • Cellulose nitrate resins
  • Cellulose propionate (plastics)
  • Coal tar resins
  • Condensation plastics
  • Coumarone-indene resins
  • Cresol resins
  • Cresol-furfural resins
  • Dicyandiamine resins
  • Diisocyanate resins
  • Elastomers, nonvulcanizable (plastics)
  • Epichlorohydrin bisphenol
  • Epichlorohydrin diphenol
  • Epoxy resins
  • Ester gum
  • Ethyl cellulose plastics
  • Ethylene-vinyl acetate resins
  • Fluorohydrocarbon resins
  • Ion exchange resins
  • Ionomer resins
  • Isobutylene polymers
  • Lignin plastics
  • Melamine resins
  • Methyl acrylate resins
  • Methyl cellulose plastics
  • Methyl methacrylate resins
  • Molding compounds, plastics
  • Nitrocellulose plastics (pyroxylin)
  • Nylon resins
  • Petroleum polymer resins
  • Phenol-furfural resins
  • Phenolic resins
  • Phenoxy resins
  • Phthalic alkyd resins
  • Phthalic anhydride resins
  • Polyacrylonitrile resins
  • Polyamide resins
  • Polycarbonate resins
  • Polyesters
  • Polyethylene resins
  • Polyhexamethylenediamine adipamide resins
  • Polyisobutylenes
  • Polymerization plastics, except fibers
  • Polypropylene resins
  • Polystyrene resins
  • Polyurethane resins
  • Polyvinyl chloride resins
  • Polyvinyl halide resins
  • Polyvinyl resins
  • Protein plastics
  • Pyroxylin
  • Resins, synthetic
  • Rosin modified resins
  • Silicone fluid solution (fluid for sonar transducers)
  • Silicone resins
  • Soybean plastics
  • Styrene resins
  • Styrene-acrylonitrile resins
  • Tar acid resins
  • Urea resins
  • Vinyl resins

Plastics Manufacturers Insurance - The Bottom Line

Plastics manufacturers insurance policies can be very different in coverage, costs and exclusions. To learn if your plastics 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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