Washington DC Manufacturing Insurance Policy Information
Manufacturing Insurance. Manufacturing is an extremely broad category that includes countless potential hazards and exposures in virtually all coverage areas. Because of this, every individual manufacturer is unique and a specific risk survey of every operation is advisable.
The basic insurance needs for every class of business or operation includes property coverage for buildings, machinery and equipment, as well as for raw stock and finished products. Liability insurance for premises exposures is important but products liability insurance presents greater concerns so these exposures and coverage needs must be evaluated carefully.
In addition, protection for injuries to workers, environmental coverages and automobile insurance are priority items.
Choosing the right type and level of Washington DC manufacturing insurance is important to your business' sustainability, profitability, and health. A combination of coverage keeps your business protected from all possible perils.
Washington DC manufacturing insurance protects your business from product liability lawsuits with rates as low as $57/mo. Get a fast quote and your certificate of insurance now.
What Type of Insurance Do Manufacturing Businesses Need?
DC manufacturers usually need more than one type of insurance policy to properly cover all of their needs. There usually isn't just one policy that will get the job done for them fully.
You likely have significant capital invested in your manufacturing business, and you must protect it with the right level and type of insurance. You must also protect your workers and the production capabilities of your business. There are generally three primary components that make up suitable Washington DC manufacturing insurance policies for manufacturers. These include:
- Product liability. Pays for the legal costs when a product you make injures someone or makes them ill.
- Product recall. Fills the gap caused by the CGL product recall exclusion. This insurance covers the expenses incurred by the insured when it conducts mandated and/or voluntary product recalls.
- Product contamination. Provides coverage when a product becomes contaminated or may become contaminated. The contamination can be due to an error or due to a criminal act. Coverage also applies when threats are received that contamination will occur unless ransom is paid. Costs that are covered include necessary inventory destruction, lost profits, business interruption, product recall and product rehabilitation. Crisis management, reputational advertising and more damage control measures are often covered too. However, there is no coverage for third-party products liability.
- Worker's compensation. Employers are required by DC state statute to provide coverage for on-the-job injuries sustained by their employees through either a workers compensation policy or a state-approved self-insurance plan. If the manufacturer uses independent contractors at off-site locations, they must verify that they actually qualify as subcontractors before an accident occurs. Otherwise, the injured party could be treated as an employee.
- Commercial auto. The commercial automobile exposures of manufacturers can vary tremendously. Some may have no exposures while others have only a salespersons' fleet. In other cases, a manufacturer may use a fleet of owned commercial trucks to deliver its finished products. The amount of international travel, if any, should be determined, due to territorial limits restrictions in the commercial auto policy, and due to restrictions, laws and regulations in a number of foreign countries.
Working with an commercial insurance broker who understands the unique nuances of DC manufacturers is important when choosing manufacturing business coverage types. A pro agent can access quotes and information from a variety of insurance companies, help you compare the policies available, and be instrumental in helping you choose the right type of coverage for your unique needs.
This allows you to get the right Washington DC manufacturing insurance policies at the right policy limits, keeping your premiums lower while ensuring your coverage remains high.
What Other Types Of Business Insurance Should Manufacturers Consider?
Covering the assets that your business owns with a Washington DC manufacturing insurance policy is important to your business' ongoing growth and overall financial health. If someone touring your DC facility becomes injured and files a claim against you, or if a fire guts your facility and leaves you without a place to manufacture your items, you need to be assured that your business can continue to operate.
In a similar vein, if a key piece of equipment becomes non-operational, you need to be ensured that the piece can be replaced without the need to shut down. Business insurance for manufacturers can be a godsend. Some essential Washington DC manufacturing insurance policy types include:
- Aviation. Larger manufacturers may own or lease aircraft and use them as a convenient way to visit their other plants and customers. In addition, some products may be transported and delivered by air cargo.
- Business Income. In the event of a work stoppage due to a covered peril, income loss coverage can help. It protects the business' building and its equipment if the loss prevents you from continuing your normal operating procedures. It can also combat lost income and operating expenses, generally for a fixed period of one year.
- Business Owner's Policy (BOP). This coverage combines general liability and commercial property along with business income and other coverages all in one package.
- Commercial Property. Output policies were designed for manufacturers as a way to close coverage gaps as raw material moved through the manufacturing processes and became finished stock. The same coverage may be achieved by combining the inland marine coverages with the building and business personal property coverage form, but the coverage is not as seamless, leaving the potential for a coverage gap. A number of valuation options are available that should be considered. Time element coverages are a vital component and the form and limits should be reviewed carefully. Business income from dependent and secondary dependent properties is an especially important coverage to be considered as companies utilize fewer and fewer suppliers and may supply fewer and fewer very large customers.
- Crime. Employee theft is the most important crime coverage needed by most manufacturers. Because of the way business is now transacted, computer fraud and funds transfer fraud are also major coverage and loss concerns. Forgery coverage should not be overlooked because checks are regularly written for large amounts. Money and securities are not usually subject to holdup losses but loss to or destruction of them is only covered under crime forms. Extortion, kidnap and ransom coverages should be seriously considered if international travel makes up part of the operation.
- Excess And Umbrella. The types of injuries that might occur because of a faulty manufactured product are the major issues in considering the appropriate higher limits and type of excess or umbrella policy to use. If the underlying coverage is written on a claims-made policy, retroactive excess liability coverage should be considered.
- General Liability. General liability coverage provides protection for accidents such as slips-and-falls or when a person in your facility is otherwise injured. It also covers property damage to third parties on your premises. It covers your legal costs and any judgement granted against you. Products liability is the major liability exposure for most manufacturers. The limitations within the CGL on products-related issues have prompted some new coverages that should be carefully reviewed with the customer. A liquor and alcoholic beverage manufacturer is wise to purchase a liquor liability policy because even limited liquor exposures are excluded in the CGL policy. If a manufacturer has a railroad sidetrack or spur on the premises, a railroad protective liability policy may be needed. When the CGL coverage form is moving from a claims-made basis to occurrence basis form then a claims-made to occurrence coverage form is vital in preventing a significant coverage gap.
- Inland Marine. Stock and other property is constantly on the move and must be covered wherever it is. Inland marine coverages are designed to follow that stock and other property. A thorough review of the manufacturing processes and operations helps determine potential coverage gaps and highlights the correct coverages needed in each situation. A transportation policy should always be written, even if the insured does not have a fleet and uses carriers for hire. Patterns and dies can be extremely valuable and are sometimes overlooked because they are located away from the insured's premises.
- Ocean Marine. Manufacturers that export products need to arrange for coverage through an ocean marine cargo policy on products shipped at their risk. In addition, if they ship to or through a war risk area, a separate cargo war risk policy should be purchased. Finally, some manufacturers own boats or yachts used to entertain both customers and employees.
- Surety Bonds. Bonding may be a major coverage concern for some manufacturers, especially if they enter into service or supply arrangements with governmental entities.
Remember, your exact Washington DC manufacturing insurance policy needs may depend on how you do your business and what you are making. Sit down with your insurance agent to discuss your current risks and exposures. These can depend on the specific types of goods you are manufacturing, where your business is located, your annual revenue, and more.
Washington DC Manufacturing Insurance - The Bottom Line
To find out more about the exact types of Washington DC manufacturing insurance policies you'll need, how much coverage your business needs - speak with an experienced insurance broker who understands the unique risks of manufacturers.
Made In Washington D.C. Economic Data, Regulations And Limits On Commercial Insurance
Whether you have a great idea for a business and you're considering your first startup company or you are already operating a business and you're looking to expand, the location of your operations is one of the most important factors you'll need to consider. In order for a business to achieve success, it must be situated in an area that offers a healthy economy and a market that your products and/or services will appeal to.
The unemployment rate of a region paints a picture of the area's economy. A lower unemployment rate indicates that the area has a healthy business climate that can sustain the residents of the region. In addition, it's important for prospective proprietors to find out which industries are thriving in the area they're considering for their operations.
Furthermore, business owners must take into consideration what type of commercial insurance policies they will need to carry in order to protect themselves, those who interact with them, and to ensure that they are compliant with the law.
If you're considering Washington, D.C. for your business, below, we provide an overview of the above-mentioned information so you can determine if the nation's capital offers favorable conditions for success.
Economic Trends For Business Owners In Washington D.C.
In December of 2019, the Bureau of Labor Statistics reported that the unemployment rate in Washington, D.C. was 5.3%. While that rate is considerably higher than what the national average of 3.5% at the same time, the rate had fallen throughout the course of the year.
For example, in July of 2019, the unemployment rate was 5.6%, in August it was 5.5%, and in October, it was 5.4%. This steady decline indicates that more employment opportunities as a result of a healthy business climate have become and are becoming available in D.C.
Washington, D.C. is divided into four specific quadrants, including NE, NW, SE, and SW. While all regions are considered suitable for businesses, those that are situated in commercial areas - Northwest, Southwest, and Southeast - as opposed to Northeast, which is primarily residential, are likely to offer the best opportunities for prospective business owners.
There are several industries that are experiencing growth in D.C. Not surprisingly, government-related sectors and businesses that provide services for the government are seeing the most growth. Additionally, leisure, hospitality, and tourism are also prime industries in the nation's capital, as the region attracts millions of tourists from around the globe. Construction, education, and health round out the top industries in the region.
Commercial Insurance Requirements In Washington D.C.
The Washington D.C. Department of Insurance, Securities and Banking regulates insurance in DC. Washington D.C. mandates very few forms of insurance coverage by law. They enforce worker's compensation.
Washington D.C. requires you to have worker's compensation insurance if you hire even one employee on a regular basis. This includes part-time employees, family members, minors, and immigrant employees. It is not required for independent contractors or domestic employees, though you should check to make sure any contractors you have are true contractors, and not employees.
Washington D.C. also requires all business-owned vehicles to be covered by commercial auto insurance. Other types of business insurance that business owners should carry depend on the specific industry.
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.
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- Product Liability
For manufacturers, having the proper coverage is very important. You will need Products/Completed Operations Liability Coverage to protect you against injuries or property damage cause my the products you make or sell.
Manufacturing is an extremely broad category that includes countless potential hazards and exposures in virtually all coverage areas. Because of this, every individual manufacturer is unique and a specific risk survey of every operation is advisable.
The basic insurance needs for every class of business or operation includes property coverage for buildings, machinery and equipment, as well as for raw stock and finished products.
Liability insurance for premises exposures is important but products liability insurance presents greater concerns so these exposures and coverage needs must be evaluated carefully.
In addition, protection for injuries to workers, environmental coverages and automobile insurance are priority items.
What does the insured does that could result in a covered loss? The insuring agreement only requires that the insured be legally obligated to pay damages for injury to others or damage to their property included within the products-completed operations hazard covered by the insurance.
Because of this, every product manufactured and completed operation exposure for each named insured must be determined, described and evaluated to be certain that each represents acceptable exposures, or are acceptable classes of business to the insurance company providing coverage.
Once the extent of all business activities and operations is determined, the process of identifying hazards begins. The first step in the process is completely listing and describing all current products being manufactured and projects being worked on.
The next step is obtaining the same information for discontinued products and completed projects for the past five to 10 years, depending on the products or projects involved. This should include an explanation of why the products were discontinued. If some completed projects were of a different type than those currently being worked on, an explanation is in order, including whether the insured may resume them in the future.
Minimum recommended small business insurance coverage: Building, Business Personal Property, Business Income with Extra Expense, Equipment Breakdown, Employee Dishonesty, Accounts Receivable, Computers, Goods in Transit, Valuable Papers and Records, General Liability, Employee Benefits Liability, Environmental Impairment Liability, Umbrella Liability, Hired and Non-owned Auto Liability & Workers Compensation.
Other commercial insurance policies to consider: Earthquake, Flood, Cyber Liability, Employment-related Practices Liability, Business Auto Liability and Physical Damage and Stop Gap Liability.
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