Woodworking Manufacturers Insurance Policy Information
Woodworking Manufacturers Insurance. Woodworking has never gone out of fashion as numerous other materials, from plastics to metals, have taken over increasing shares of the furniture market - but the industry has indeed evolved a great deal.
Some woodworkers may still live up to the images in the heads of many laypeople, sawing and sanding pieces by hand, but on the whole, the woodworking industry has become a technologically-advanced place.
Woodworking shops produce a variety of products, including cabinets, picture frames, shelving, and other products made of solid wood, veneered plywood, or particleboard. The finished product may be pre-assembled, or assembled during installation by the customer or a contractor.
The woodworking shop receives wood products in specific lengths and widths. The wood is seasoned (dried either in kilns or in the yard), then cut, planed, sanded, assembled with glue or hardware, stained, varnished, and painted or otherwise finished.
Modern production work will usually employ CNC workstations (computerized machining), but custom work may be done by hand. Custom manufacturers may also install their product. Some cabinet makers may also own a retail outlet.
If you own and operate a woodworking shop, you are likely to make use of numerous complex and costly tools, ranging from sawmills to drill presses, wood-nailing machines, and even CNC machines. Surrounded by this incredible equipment, woodworking shops can never let their minds wander too far from the numerous risks they face. The adhesives woodworkers use over the course of their jobs, too, can pose serious hazards.
Circumstances beyond your control could devastate your woodworking shop - unless, of course, you are protected by the right type of woodworking manufacturers insurance coverage. That is why you should read on to find out what essential insurance needs companies within the woodworking industry can never ignore.
Woodworking 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 woodworking manufacturing insurance questions:
- What Is Woodworking Manufacturers Insurance?
- How Much Does Woodworking Manufacturers Insurance Cost?
- Why Do Woodworkers Need Insurance?
- What Type Of Insurance Do Woodworking Manufacturers Need?
- What Does Woodworking Manufacturers Insurance Cover & Pay For?
What Is Woodworking Manufacturers Insurance?
Woodworking manufacturers insurance is a type of insurance coverage specifically designed for companies that manufacture wooden products and materials. This insurance protects the company from potential financial losses and liabilities that may arise from accidents, injuries, property damage, and other risks associated with the production and sale of wooden products.
Examples of coverage under woodworking manufacturers insurance may include general liability, product liability, workers' compensation, property damage, and business interruption. The purpose of this insurance is to provide financial security and peace of mind for woodworking manufacturers, so they can continue their operations without the worry of unexpected expenses and legal issues.
How Much Does Woodworking Manufacturers Insurance Cost?
The average price of a standard $1,000,000/$2,000,000 General Liability Insurance policy for small woodworking manufacturing businesses ranges from $57 to $79 per month based on location, size, revenue, claims history and more.
Why Do Woodworkers Need Insurance?
Woodworking shops may range from small and even family-run businesses to booming operations that may only handle specific portions of the secondary wood products industry. They will be vulnerable to some of the same pitfalls as other commercial ventures, as well as facing potential threats more specific to the woodworking industry itself.
Theft and vandalism (including arson) are always a risk, for example. It is easy to push the risk of acts of nature, natural disasters such as floods or wildfires that could damage your entire inventory, to the back of your mind - but they too can strike.
Should an essential piece of machinery become damaged or break down, you may need to interrupt your production process, placing your bottom line in serious peril. With so many power tools, woodworking shops should also always be prepared for the possibility that an employee could be seriously injured in the workplace.
These and other types of threats explain why adequate woodworking manufacturers insurance coverage cannot be overlooked.
What Type Of Insurance Do Woodworking Manufacturers Need?
Every commercial venture has unique insurance needs. Yours depend on several factors, ranging from the type of power tools and electronic equipment you use in the manufacture of wood products, to the size and location of your business, and its number of employees.
To find out what your exact woodworking manufacturers insurance needs are, you will want to consult a seasoned agent who specializes in commercial insurance. The needs of small and large businesses will vary, however, most woodworkers will require the following types of insurance:
- General Liability: This kind of insurance is there to prevent financial losses resulting from third party personal injury and property damage liability, and covers legal expenses. Circumstances that could cause a woodworking shop to rely on general liability insurance would include a third party visiting your premises tripping on a piece of cord and becoming hurt, for example, or accidental damage to customers' properties as you deliver an order.
- Commercial Property: This type of insurance is another must-have. Should a criminal act, accident, or act of nature damage your building or the assets, including machinery, within, commercial property insurance will compensate your company for the losses as well as lost revenue should you have to interrupt production. Equipment breakdown insurance is a sub-type that you will want to investigate if you have valuable equipment onsite.
- Workers' Compensation: All but the very smallest companies will need to carry workers comp insurance. It covers medical expenses and lost wages should a worker sustain work-related injuries, both acute injuries such as power tool accidents, and long-term conditions such as repetitive stress injury.
These types of woodworking manufacturers insurance are only examples of the kind of coverage you will need as a woodworker. That is why you cannot do without a commercial insurance broker.
When you consult the agent of your choice, also ask them about auto insurance, which any company that uses vehicles needs, and product liability insurance, which could protect your company from liability should a consumer be harmed by one of your products.
To make sure your needs are met properly, consult an agent who specializes in commercial insurance.
Woodworking Manufacturing's Risks & Exposures
Premises liability exposure at the plant is normally low as access by visitors is limited. If tours are given or if there is a retail outlet on the premises, visitors may be injured by slips, trips, falls, or flying debris.
The storage of wood in the open could pose an attractive nuisance hazard. The yard should be fenced to prevent unauthorized access, with proper lighting and warnings. Dust, fire or explosion, fumes, and noise may cause damage to adjacent properties.
If the manufacturer offers retail delivery or installation, there may be frequent small property damage claims.
Products liability exposure is based on the final use of the product as well as whether the manufacturer prepares the use specifications. Workmanship errors, such as wood splinters, protruding nails, or poorly cut openings, present nuisance hazards. Items designed to support a customer's weight can fail, resulting in bodily injury.
Environmental impairment exposures may be significant due to possible contamination of ground, air, and water from sawdust, chemicals, paint, and varnishes generated by processing and the lubricants and solvents used to service machinery. Storage and disposal procedures must adhere to all EPA and other regulatory standards.
Workers compensation exposure may be very high. Injuries from production machinery are common, as are slips, trips, falls, back injuries from lifting, foreign objects in the eye due to flying wood chips and dust, hearing loss from noise, and repetitive motion losses. There should be safety training and protective equipment.
Workstations should be ergonomically designed. Amputations can occur from working with saws. The high volume required for production schedules may lead workers to remove guards on the machinery, or to postpone maintenance and repair to increase production. Exposure to chemicals, dust, glues, binding agents, paints, and varnishes can result in burns and eye, skin, and lung irritation.
Drivers of forklifts and vehicles may be injured in accidents.
Property exposures consist of an office, shop, warehouse for finished goods, and often a yard for storage of raw materials. Ignition sources include electrical wiring, heating, and cooling equipment, overheating of production machinery, and explosions from the build-up of dust from the cutting and sanding operations.
The risk increases dramatically in the absence of proper dust collection systems, ventilation, and adequate disposal procedures.
Wood is highly combustible and susceptible to damage by fire, smoke, and water. Glues, paints, varnishes, and stains may be flammable and must be adequately separated and stored from other operations. Spray-painting operations should be carried out in spray booths with explosion-proof electrical components. The use of dip tanks instead of spray booths may require special attention. Exotic woods or expensive hardwood products may be attractive to thieves.
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.
Business income and extra expense exposures can be high if a lengthy amount of time is required to restore operations.
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 indirect.
Crime exposure comes from employee dishonesty and theft if the raw wood is expensive or finished items are high in demand. 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), contractors' equipment, and exhibitions, goods in transit, and valuable papers and records for customers' and suppliers' information.
The major perils are fire, theft, collision and overturn. If the manufacturer installs products, an installation floater should be considered.
Business auto exposure is high if the manufacturer transports raw materials or finished products. Proper loading and tie down procedures are essential to prevent overturn and /or release of lumber. The risk increases if there is a potential for long haul or time pressures on drivers. Manufacturers generally have private passenger fleets used by sales representatives.
There should be written procedures regarding the private use of these vehicles by others. Each driver should have an appropriate license and an acceptable MVR. All vehicles must be well maintained with documentation kept in a central location.
What Does Woodworking Manufacturers Insurance Cover & Pay For?
Woodworking manufacturers can face a variety of legal issues that might lead to lawsuits. However, having the right type of insurance coverage can help protect them financially. Here are a few examples:
1. Product Liability: If a product manufactured by a woodworking company causes harm or injury to a customer, the company could be held liable. For example, a chair might break under normal use, causing the user to fall and get injured. Product liability insurance can help pay for the legal defense and any settlements or judgments related to the claim. This type of insurance is typically part of a company's general liability insurance policy.
2. Workers' Compensation: Woodworking involves working with potentially dangerous tools and machinery, so accidents can happen. If an employee is injured on the job, the company could be sued for damages. Workers' compensation insurance can help cover medical costs, lost wages, and legal fees associated with these kinds of claims. This insurance is mandatory in most states.
3. Property Damage: Fires, floods, or other disasters can damage a woodworking facility, equipment, or inventory. If a third party alleges that the damage caused harm to their property, the company could face a lawsuit. Commercial property insurance can help cover the cost of repairing or replacing the damaged property, and liability insurance can cover any legal expenses related to claims of third-party property damage.
4. Professional Negligence: If a woodworking company fails to meet the expected professional standards, resulting in financial loss or harm to a client, they could be sued for professional negligence. For instance, if a custom-made kitchen set is not made to the agreed specifications, and this leads to financial loss for the customer. Professional liability insurance, often called errors and omissions (E&O) insurance, can help cover the costs of such lawsuits, including legal defense and any settlements or judgments.
5. Commercial Auto Accidents: If a company vehicle is involved in an accident while transporting goods or employees, the woodworking company could be held liable for any resulting injuries or property damage. Commercial auto insurance can help cover the costs associated with these types of accidents, including medical expenses, repair costs, and any associated legal fees.
In summary, various types of insurance can provide financial protection for woodworking manufacturers against a range of potential lawsuits. It's important for companies to work closely with their insurance providers to ensure they have the right coverage to match their specific risks and needs.
Commercial Insurance And Business Industry Classification
- SIC CODE: 2499 Wood Products, Not Elsewhere Classified
- NAICS CODE: 321999 All Other Miscellaneous Wood Product Manufacturing
- Suggested Workers Compensation Code(s): 2841 Wood Turned Products Manufacturing NOC, 2802 Carpentry - Shop Only & Drivers
Description for 2499: Wood Products, Not Elsewhere Classified
Division D: Manufacturing | Major Group 24: Lumber And Wood Products, Except Furniture | Industry Group 249: Miscellaneous Wood Products
2499 Wood Products, Not Elsewhere Classified: Establishments primarily engaged in manufacturing miscellaneous wood products, not elsewhere classified, and products from rattan, reed, splint, straw, veneer, veneer strips, wicker, and willow.
- Applicators, wood
- Bakers' equipment, wood
- Baskets, except fruit, vegetable, fish, and bait: (e.g., rattan, reed,
- Battery separators, wood
- Bearings, wood
- Beekeeping supplies, wood
- Bentwood (steam bent) products, except furniture
- Blocks, tackle: wood
- Blocks, tailors' pressing: wood
- Boards, bulletin: wood and cork
- Boards- clip, ironing, meat, and pastry-wood
- Boot and shoe lasts, regardless of material
- Bowls, wood: turned and shaped
- Briquettes, sawdust or bagasse: non-petroleum binder
- Bungs, wood
- Buoys, cork
- Bushings, wood
- Cane, chair: woven of reed or rattan
- Carpets, cork
- Cloth winding reels, wood
- Clothes dryers (clothes horses), wood
- Clothes drying frames, wood
- Clothes pins, wood
- Clubs, police: wood
- Cooling towers, wood or wood and sheet metal combination
- Cork products
- Corks, bottle
- Covers, bottle and demijohn: willow, rattan, and reed
- Curtain stretchers, wood
- Dishes, wood
- Display forms for boots and shoes, regardless of material
- Dowels, wood
- Extension planks, wood
- Faucets, wood
- Fellies, wood
- Fencing, wood: except rough pickets, poles, and rails
- Firewood and fuel wood containing fuel binder
- Flour, wood
- Frames: medallion, mirror, photograph, and picture-wood or metal
- Furniture inlays (veneers)
- Garment hangers, wood
- Gavels, wood
- Grain measures, wood: turned and shaped
- Hammers, meat: wood
- Hampers, laundry: rattan, reed, splint, veneer, and willow
- Handles, wood: turned and shaped
- Hubs, wood
- Insulating materials, cork
- Jacks, ladder: wood
- Knobs, wood
- Ladders, wood
- Last sole patterns, regardless of material
- Letters, wood
- Life preservers, cork
- Mallets, wood
- Market baskets, except fruit and vegetable: veneer and splint
- Marquetry, wood
- Mashers, potato: wood
- Masts, wood
- Mauls, wood
- Moldings, picture frame: finished
- Novelties, wood fiber
- Oars, wood
- Pads, table: rattan, reed, and willow
- Paint sticks, wood
- Pencil slats
- Plugs wood
- Poles wood: e.g., clothesline, tent, flag
- Pressed logs of sawdust and other wood particles, non-petroleum
- Pulleys, wood
- Racks, for drying clothes: wood
- Rattan ware, except furniture
- Reed ware, except furniture
- Reels cloth winding wood
- Reels for drying clothes: wood
- Reels, plywood
- Rollers, wood
- Rolling pins, wood
- Rules and rulers: wood, except slide
- Saddle trees, wood
- Sawdust, reground
- Scaffolds, wood
- Scoops, wood
- Seat covers, rattan
- Seats, toilet: wood
- Shoe stretchers, regardless of material
- Shoe trees, regardless of material
- Signboards, wood
- Skewers, wood
- Snow fence
- Spars, wood
- Spigots, wood
- Spokes, wood
- Spools, except for textile machinery: wood
- Stakes, surveyors': wood
- Step-ladders, wood
- Stoppers, cork
- Tile, cork
- Tool handles, wood: turned and shaped
- Toothpicks, wood
- Trays: wood, wicker, and bagasse
- Trophy bases, wood
- Vats, wood: except coopered
- Washboards, wood and part wood
- Webbing: cane, reed, and rattan
- Willow ware, except furniture
- Wood, except furniture: turned and carved
- Woodenware, kitchen and household
- Yardsticks, wood
Woodworking Manufacturers Insurance - The Bottom Line
Woodworking manufacturers insurance policies can vary widely coverage, exclusions and cost. You can see if your manufacturing operation has the best fit insurance policies by talking to an experienced commercial insurance broker.
Often they are able to save you on premiums and offer you better policy options than you currently have.
Additional Resources For Manufacturing Insurance
Learn all about manufacturing insurance. Manufacturers face many unique risks such as product libility and/or product recall exposures due to the nature of their business operations.
- 3D Printing
- 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.