Textile Manufacturers Insurance Policy Information
Textile Manufacturers Insurance. The textile industry is a complex one that comprises a multitude of different aspects - from spinning and weaving, finishing fibers to dying, embroidery, and printing - either natural or synthetic.
The manufacture of garments and a wide range of other textile products, such as awnings, upholstery, fabric backpacks, and bedding can be considered the final stage in the process.
Within this colossal industry - valued, globally, at over 961 billion US dollars in 2019 - both small and large businesses can thrive. To be able to prosper, however, textile manufacturers have to be fully aware of the many perils that could devastate their financial health, as well as take the right steps to be fully insured against them.
Are you curious what types of textile manufacturers insurance are needed, or are you investigating your insurance requirements as you put together a business plan for a company you are hoping to start? This brief guide will point you in the right direction.
Textile 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 textile manufacturing insurance questions:
- What Is Textile Manufacturers Insurance?
- How Much Does Textile Manufacturers Insurance Cost?
- Why Do Textile Manufacturers Need Insurance?
- What Type Of Insurance Do Textile Manufacturers Need?
- What Does Textile Manufacturers Insurance Cover & Pay For?
What Is Textile Manufacturers Insurance?
Textile manufacturers insurance is a type of insurance policy designed to protect textile manufacturing companies from financial loss due to unexpected events such as fire, theft, natural disasters, and liability claims.
This insurance covers the company's physical assets, such as machinery, buildings, and products, as well as protects against liability claims that may arise from the production process, such as product defects or workplace injuries. This type of insurance is important for textile manufacturers to secure their investments and ensure the continued success of their business.
How Much Does Textile Manufacturers Insurance Cost?
The average price of a standard $1,000,000/$2,000,000 General Liability Insurance policy for small textile manufacturing businesses ranges from $57 to $79 per month based on location, size, revenue, claims history and more.
Why Do Textile Manufacturers Need Insurance?
Knowing that a company has the insurance coverage that could keep it safe should unforeseen circumstances threaten it offers peace of mind, allowing business owners and managers to focus on what they do best - running a smooth operation and working to expand their business.
The simple fact is, after all, that any commercial venture can be impacted by catastrophes, often without warning.
Acts of nature, which would include such disastrous events as earthquakes or hurricanes, but also smaller-scale wildfires or floods, could force you to stop production by severely damaging your facility. Vandalism and theft should also be on your radar.
Situations more specific to the textile industry would include workplace injury; in textile manufacture, workers are vulnerable to inhaling textile dust and chemicals, for example. Fires, which can be accidental as well as intentionally set or the result of negligence, are another serious threat in the textile industry.
These and many other risks cannot always be prevented - but business in this industry can do the next best thing, and prepare for them by investing in the right textile manufacturers insurance coverage.
What Type Of Insurance Do Textile Manufacturers Need?
Whether a company focuses on making athletic gear or produces curtains or any other finished textile product, some types of insurance are essential in protecting its financial health.
Other types of coverage may or may not be required, depending on the jurisdiction in which your manufacturing facility is based, the terrain, the equipment you use, and your number of workers, among other factors.
A commercial insurance agent who understands the textile industry can hep you build your ideal insurance coverage. However, the types of textile manufacturers insurance needed include:
- Commercial Property: This essential kind of textile manufacturers insurance protects you from financial losses resulting from circumstances beyond your control, such as fires and theft. It covers your real estate as well as other physical assets, ranging from your inventory to your equipment.
- General Liability: In the event that third parties sustain an injury on your premises, something that could result from an event as simple as a fall on a slippery floor, they may hold your company responsible. The same holds true if your activities cause damage to third party properties; for instance, if a fire in your facility spreads to a neighboring company. Legal expenses and settlement fees fall under general liability insurance for companies.
- Workers Compensation: Required for nearly all companies, this kind of insurance covers your employees' medical expenses and lost wages while recovering, should they become injured in the workplace in circumstances for which the company is considered responsible.
Textile manufacturers that produce products that could potentially cause injury or property damage as a result of manufacturing errors or other harms for which the company might be held liable will further need product liability insurance. The manufacture of hammocks could be one example.
However, textile manufacturers should be aware that their insurance needs are as unique as their business, and you may well require additional forms of insurance, ranging from commercial auto to inland marine and even commercial umbrella insurance to cover situations that your regular insurance does not.
A competent commercial insurance agent can help you get the textile manufacturers insurance coverage that ultimately offers the best protection.
Textile Manufacturing's Risks & Exposures
Premises liability exposure is limited due to controlled access of visitors. If the manufacturer has a showroom or offers tours, visitors may be injured by slips, trips, or falls. Chemicals used in the coating and finishing may be corrosive and/or toxic.
Fire, fumes, spills or leaks may cause serious injury or property damage to neighboring premises.
Products liability exposure is low to moderate depending on the end use of the goods. If goods are used to produce infants' or children's wear, all standards of flammability must be met. Warranties for fire resistive, hypoallergenic, sterile, or waterproof items can result in losses if the products fail to perform.
Environmental impairment exposure is very high due to the use of corrosive and/or toxic chemicals during processing. Fumes and improper disposal of scrap can result in air, ground, or water contamination. Disposal procedures must adhere to all EPA and other regulatory standards.
Workers compensation exposure is very high due to the chemicals used in coating and finishing fabrics and fibers. Many are toxic and special controls are needed. Skin and eye irritations are common, and continued exposure can result in serious lung and respiratory problems.
Injuries from production machinery are common, as are burns, cuts, slips, trips, falls, foreign objects in the eye, hearing loss from machinery noise, overheating and exhaustion in high temperatures, and back injuries from lifting. 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. The high volume required for production schedules may lead workers to remove guards on the machinery, or to postpone maintenance and repair.
Repetitive motion injuries can result from ongoing use of machinery. Workstations should be ergonomically designed.
Property exposures consist of an office, production plant, and warehouse for raw materials or finished goods. Ignition sources include electrical wiring, heating systems, and production machinery. Chemicals used in fabric dyeing or coating are often flammable and should be properly labeled, separated, and stored in approved containers.
Dust from some fabrics and from many coatings may present an explosion hazard. These hazards may be severe unless there are dust collection systems that are well maintained. Fabrics and coatings are often highly combustible, especially if poorly stored without adequate aisle space and shelving.
Some fabrics, such as silk, are subject to damage by water, moisture, or smoke. Minor fires may result in major inventory losses. Poor housekeeping, such as failure to collect and dispose of scraps on a regular basis, could contribute significantly to a loss.
Unless disposed of properly, greasy, oily rags (such as those used to clean the machinery) can cause a fire without a separate ignition source. Sprinklers may be advisable.
Appropriate security controls must 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, dust collection and ventilation systems, electrical control panels and other apparatus. These should be properly maintained and records kept in a central location.
Crime exposure comes from employee dishonesty and theft of expensive materials such as silk or designer brands. 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 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), exhibitions, 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. Goods in transit may be damaged by fire, collision, overturn, theft, and water damage.
Commercial auto exposure may be high if the manufacturer transports raw materials or finished products. 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.
If the chemicals used to finish and coat fabrics are transported by the manufacturer in tanker trucks, drivers of these vehicles must have a Hazardous Material Endorsement on his or her Commercial Driver Licenses and be trained to contain spills.
What Does Textile Manufacturers Insurance Cover & Pay For?
Textile manufacturers can face various lawsuits related to product liability, workplace injuries, intellectual property rights, and environmental damages, among others. In each case, having the appropriate insurance coverage can help manage the financial risks involved. Here are some examples:
1. Product Liability: If the textiles produced by a manufacturer cause harm to a consumer due to a defect, the manufacturer can be sued for product liability. For instance, if a consumer suffers an allergic reaction due to undisclosed materials in a garment, the manufacturer could face legal action. Product liability insurance can protect the manufacturer in such cases. This insurance covers the cost of legal defense, as well as any settlements or judgments resulting from the lawsuit.
2. Workplace Injuries: Textile manufacturing involves machinery that can cause accidents and injuries. If an employee is injured on the job, the manufacturer could be sued for damages. Workers' compensation insurance is designed to cover such risks. It provides benefits to injured workers for medical costs and a portion of their lost income, which can protect the employer from being sued for those costs.
3. Intellectual Property Rights: If a textile manufacturer is accused of infringing on another company's patent or design, they could be sued. Intellectual property insurance can cover the costs of defending against such lawsuits and any associated settlements or judgments. It can also help with the costs of enforcing the manufacturer's own intellectual property rights.
4. Environmental Damages: The textile industry uses chemicals and processes that can harm the environment. If a manufacturer is found to be responsible for environmental damage, they could face a lawsuit. Environmental liability insurance can cover the costs of such lawsuits, including legal defense, cleanup efforts, and any fines or settlements.
Insurance plays a crucial role in protecting textile manufacturers from the financial repercussions of lawsuits. However, it's important to remember that insurance is only one aspect of risk management. Ensuring safe practices, compliance with regulations, and proactive risk mitigation strategies should be a part of any comprehensive approach to managing business risk.
Commercial Insurance And Business Industry Classification
- SIC CODE: 2295 Coated Fabrics, Not Rubberized, 2296 Tire Cord And Fabrics, 2297 Non-Woven Fabrics, 2298 Cordage And Twine, 2299 Textile Goods, Not Elsewhere Classified
- NAICS CODE: 313110 Fiber, Yarn and Thread Mills, 313210 Broadwoven Fabric Mills, 313220 Narrow Fabric Mills and Schiffli Machine Embroidery, 313230 Nonwoven Fabric Mills, 313240 Knit Fabric Mills, 313310 Textile and Fabric Finishing Mills, 313320 Fabric Coating Mills, 313230 Nonwoven Fabric Mills, 314120 Curtain and Linen Mills, 314994 Rope, Cordage, Twine, Tire Cord, and Tire Fabric Mills, 314999 All Other Miscellaneous Textile Product Mills
- Suggested Workers Compensation Code(s): 2211 Wool Combing or Scouring, 2220 Carpet or Rug Manufacturing - Jute or Hemp, 2286 Yarn Manufacturing - Wool, 2288 Felting Manufacturing, 2305 Textile Fiber Manufacturing - Synthetic, 2380 Braid or Fringe Manufacturing, 2413 Cloth Printing - Silk Screen Process - Machinery Operations, 2416 Thread or Yarn Dyeing or Finishing, 2417 Cloth Printing
Description for 2295: Coated Fabrics, Not Rubberized
Division D: Manufacturing | Major Group 22: Textile Mill Products | Industry Group 229: Miscellaneous Textile Goods
2295 Coated Fabrics, Not Rubberized: Establishments primarily engaged in manufacturing coated, impregnated, or laminated textiles, and in the special finishing of textiles, such as varnishing and waxing. Establishments primarily engaged in rubberizing purchased fabrics are classified in Industry 3069, and those engaged in dyeing and finishing textiles are classified in Industry Group 226 or Industry 2231.
- Buckram: varnished, waxed, and impregnated
- Cambric: varnished, waxed, and impregnated
- Cloth, varnished glass
- Coating and impregnating of fabrics, except rubberizing
- Fabrics, coated and impregnated: except rubberized
- Laminating of fabrics
- Leather, artificial or imitation
- Mats, varnished glass
- Metallizing of fabrics
- Plastics coated fabrics
- Pyroxylin coated fabrics
- Resin coated fabrics
- Sealing or insulating tape for pipe, fiberglass coated with tar or
- Sleeving, textile: saturated
- Tape, varnished: plastics and other coated: except magnetic-mfpm
- Tubing, textile: varnished
- Waxing of cloth
- Yarns, plastics coated: made from purchased yarns
Description for 2296: Tire Cord And Fabrics
Division D: Manufacturing | Major Group 22: Textile Mill Products | Industry Group 229: Miscellaneous Textile Goods
2296 Tire Cord And Fabrics: Establishments primarily engaged in manufacturing cord and fabric of manmade fibers, cotton, glass, steel, or other materials for use in reinforcing rubber tires, industrial belting, fuel cells, and similar uses.
- Cord for reinforcing rubber tires, industrial belting, and fuel cells
- Fabrics for reinforcing rubber tires, industrial belting, and fuel cells
- Glass tire cord and tire cord fabrics
- Steel tire cord and tire cord fabrics
Description for 2297: Non-Woven Fabrics
Division D: Manufacturing | Major Group 22: Textile Mill Products | Industry Group 229: Miscellaneous Textile Goods
2297 Non-Woven Fabrics: Establishments primarily engaged in manufacturing non-woven fabrics (by bonding and/or interlocking of fibers) by mechanical, chemical, thermal or solvent means, or by combinations thereof. Establishments primarily engaged in producing woven felts are classified in Industry 2231; and those producing other felts are classified in Industry 2299.
- Bonded-fiber fabrics, except felt
- Fabrics, bonded fiber: except felt
- Fabrics, non-woven: except felts
- Ribbon, non-woven (yarn bonded by plastics)
- Spunbonded fabrics
Description for 2298: Cordage And Twine
2298 Cordage And Twine: Establishments primarily engaged in manufacturing rope, cable, cordage, twine, and related products from abaca (Manila), sisal, henequen, hemp, cotton, paper, jute, flax, manmade fibers including glass, and other fibers.
- Binder and baler twine
- Blasting mats, rope
- Cable, fiber
- Camouflage nets, not made in weaving mills
- Cargo nets (cordage)
- Cord, braided
- Cordage: abaca (Manila), sisal, henequen, hemp, jute, and other
- Fish nets and seines, made in cordage or twine mills
- Fishing lines, nets, seines: made in cordage or twine mills
- Hard fiber cordage and twine
- Insulator pads, cordage
- Nets, rope
- Rope, except asbestos and wire
- Slings, rope
- Soft fiber cordage and twine
- Trawl twine
- Wire rope centers
Description for 2299: Textile Goods, Not Elsewhere Classified
2299 Textile Goods, Not Elsewhere Classified: Establishments primarily engaged in manufacturing textile goods, not elsewhere classified, including linen goods, jute goods, felt goods, padding and upholstery filling and processed waste and recovered fibers and flock. Establishments primarily engaged in processing textile fibers to prepare them for spinning, such as wool scouring and carbonizing and combing and converting tow to top, are also classified here. Establishments primarily engaged in manufacturing woven wool felts and wool haircloth are classified in Industry 2231, and those manufacturing needle punch carpeting are classified in Industry 2273 . Establishments primarily engaged in manufacturing embroideries are classified in Industry Group 239. Establishments primarily engaged in manufacturing lace goods are classified in Industry 2258. Establishments primarily engaged in sorting wiping rags or waste are classified in Wholesale Trade, Industry 5093.
- Apparel filling: cotton mill waste, kapok, and related materials
- Bagging, jute: made in jute weaving mills
- Batts and batting cotton mill waste, kapok, and related materials
- Burlap, jute
- Carbonized rags
- Coir yarns and roving
- Crash, linen
- Fabrics: linen, jute, hemp, ramie
- Felt goods, except woven felts and hats: wool, hair, jute, or other
- Felts, pressed or needle loom
- Fibers, textile: recovery from textile mill waste and rags
- Flax yarns and roving
- Flock (recovered textile fibers)
- Garnetting of textile waste and rags
- Grease, wool
- Hair, curled: for upholstery, pillow, and quilt filling
- Handwoven fabrics
- Hemp yarn, thread, roving, and textiles
- Linings, carpet: felt except woven
- Mats, felt: except woven
- Narrow woven fabrics: linen, jute, hemp, and ramie
- Noils, wool and mohair
- Packing, twisted jute
- Padding and wadding, textile
- Pads and padding, felt: except woven
- Pads, fiber: henequen, sisal, istle
- Pillow filling: curled hair (e.g., cotton waste, moss, hemp tow,
- Pipe and boiler covering, felt
- Polishing felts, except woven
- Preparing textile fibers for spinning (scouring and combing)
- Pressed felts
- Processing of textile mill waste and recovering fibers
- Punched felts
- Quilt filling: curled hair (e.g., cotton waste, moss, hemp tow, kapok)
- Ramie yarn, thread, roving, and textiles
- Rayon tops, combing and converting
- Recovering textile fibers from clippings and rags
- Roves, flax and jute
- Rug backing, jute or other fiber
- Slubs and nubs (cutting up fibers for use in tweeds)
- Textile mills: linen, jute, hemp, and ramie yarn, thread, and fabrics
- Thread: linen, hemp, and ramie
- Tops, combing and converting
- Tops, manmade fiber
- Tow to top mills
- Towels and towelings, linen and linen-and-cotton mixtures-mitse
- Trimming felts, except woven
- Upholstery filling, textile
- Wads and wadding, textile
- Webbing, jute
- Wool felts, pressed or needle loom
- Wool scouring and carbonizing
- Wool shoddy
- Wool tops, combing and converting
- Wool waste processing
- Yarn, specialty and novelty
- Yarn: flax, jute, hemp, and ramie
- Yarn: metallic, ceramic, or paper fibers
Textile Manufacturers Insurance - The Bottom Line
Textile manufacturers insurance policies can differ a lot in coverage, costs and exclusions. To discover if your textile manufacturing firm has the best fit insurance policies for your operations - talk to an experienced business 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
- Audio & Video Equipment
- Auto Parts
- Bottling Plants
- 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
- Dairies & Creameries
- Down And Feather Products
- Dry Ice
- Dyes & Pigments
- Electronic Toys & Games
- Exercise Equipment
- Farm Equipment
- Feed & Grain
- Flavoring Extracts
- Frozen Foods
- Fruit Juice
- Fur Garment
- Garage Door
- Gypsum Products
- Ice Cream
- Industrial Equipment
- Iron & Steel Foundries
- Lawn Mowers
- Leather Apparel
- Leather Goods
- 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
- Psychedelic Drugs
- 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
- Vegetable Juice
- Vending Machines
- Wire Rope
- Wood Furniture
- Writing Instruments
- 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.