Commercial Coverages | Product
Product Liability & E&O Insurance for Michigan Businesses
Some businesses face risk because of what they sell. Others face risk because of what they advise, design, or deliver. And many face both. This page covers two important types of protection:
- Product Liability – helps if a product you make, sell, or distribute is alleged to cause bodily injury or property damage.
- Professional Liability (Errors & Omissions / E&O) – helps if a client claims your professional services, advice, or work product caused them a financial loss.
If you’re not sure which one applies to your business (or whether you already have either), we’ll help you confirm what’s in place and where gaps may exist.
Quick Take
- Best for: manufacturers, distributors, retailers, and service providers whose work can create client financial loss
- Typically helps with:
- product-related injury/property damage claims (and defense costs)
- service-related “mistake, oversight, or failure to deliver” allegations (and defense costs)
- Often paired with: Commercial Umbrella, Cyber, Contract review (certificates/additional insureds), and industry-specific add-ons
- Not sure what you need? We’ll help you match coverage to how your business actually operates.
Who Needs Product or Professional Liability Coverage?
Businesses with Product Exposure
- Manufacturers (components, parts, finished goods)
- Distributors, wholesalers, and importers
- Retailers (in-store and e-commerce)
- Private-label Brands & Businesses that rebrand products
- Food & Beverage Producers & Packaged Goods Brands
Businesses with Professional Services Exposure (E&O)
- Consultants & Agencies (marketing, IT, operations, HR)
- Designers & Engineers (depending on scope and contracts)
- Real Estate, Insurance-adjacent & Financial Services Firms (where applicable)
- Technology & Software/Service Providers
- Businesses that provide specifications, recommendations, or “we’ll handle it” services for clients
What it Typically Helps Cover
Product Liability
Product liability coverage is intended to help protect your business if a product you make, sell, or distribute is alleged to cause bodily injury or property damage to others. In many cases, this exposure is addressed through your Commercial General Liability (CGL) policy’s products-related coverage.
It often helps with:
- Legal defense costs
- Settlements or judgments (if you’re legally liable)
- Claims alleging defects, design issues, or failure-to-warn (depending on policy language and the loss)
Professional Liability (Errors & Omissions / E&O)
E&O is designed for a different kind of claim: not “someone got hurt,” but “your work caused us a financial loss.”
It often helps with claims like:
- Alleged errors, oversights, or negligent professional services
- Failure to deliver services as promised (as defined by the policy)
- Certain claims involving work product, recommendations, or specifications
Important: E&O is typically about financial harm, not physical injury or property damage.
What it May Not Cover
This is where clarity matters most. Depending on policy terms and the situation, these coverages may not include:
Common Product Liability Gaps
- Product recall costs (often requires separate product recall coverage)
- Warranty/guarantee disputes or the cost to repair/replace your own product (when there’s no third-party injury/property damage)
- Intentional wrongdoing or known defects (generally excluded)
Common E&O Gaps
- Bodily injury/property damage (usually handled by general liability, not E&O)
- Contractual disputes that don’t involve a covered professional error (varies by policy)
- Known issues prior to the policy period or intentional misconduct (generally excluded)
- Cyber events (often need separate cyber coverage)
Real-World Claim Scenarios
Product Claim
A customer alleges your product caused an injury
A claim is filed alleging a defect caused bodily injury. Product liability coverage may help with defense costs and damages if you’re legally liable.
Product claim:
A component you supplied damages someone else’s equipment
A part fails and a customer alleges it caused property damage. Product liability may respond when third-party property damage is involved.
E&O claim:
A client alleges your recommendation or work caused financial loss
A client claims your professional services (design, advice, implementation, or deliverables) caused them to lose money, miss a deadline, or incur rework costs. E&O may help with defense and covered damages, depending on policy terms and allegations.
What Impacts Cost
Pricing depends on the unique details of your business. Common factors include:
- Product type, severity risk, and sales volume
- Revenue, growth trajectory, and distribution footprint (local vs nationwide/e-commerce)
- Whether you manufacture, import, private-label, or resell
- Quality control/testing and risk management processes
- Services provided (for E&O), contract language, and deliverable responsibility
- Claims history and years in business
- Limits, deductibles, and whether you add an umbrella
- Contract requirements (higher limits, additional insureds, special endorsements)
What We'll Ask You For
To quote accurately, we’ll typically request:
- A brief description of your operations (what you do and don’t do)
- Product list and how products are used (if applicable)
- Manufacturing/import/private-label details (who makes it, where, and under whose name)
- Where you sell/ship (states, online marketplaces, major clients)
- Annual sales/revenue and employee count
- Contracts requiring insurance (vendor agreements, client contracts, COI requirements)
- Current policies and loss runs (if available)
- For E&O: a high-level scope of services, typical contracts/terms, and deliverables
FAQs
Is product liability included in general liability?
Often, product liability exposure is addressed within a CGL policy’s products-related coverage. The details depend on the policy and your operations.
Do retailers and distributors need product liability too?
Often yes – sellers and distributors can still be named in lawsuits even if they didn’t manufacture the product.
Does product liability cover product recalls?
Usually not. Recall costs often require separate coverage.
Does product liability cover the cost to replace my product?
Not typically when there’s no third-party injury or property damage involved.
What is professional liability (E&O)?
E&O is designed to help if a client claims your professional services, advice, or work product caused them financial harm.
Do I need E&O if I already have general liability?
Often, yes – because general liability and E&O are built for different kinds of claims (injury/property damage vs. financial loss).
Do I need both product liability and E&O?
Many businesses do – especially if they both sell products and provide professional services (e.g., design + supply, configure + install, consult + implement).
Will contracts require E&O or product liability?
Frequently. Many customers and vendors require specific limits and wording. We’ll review requirements with you.
Should I add an umbrella policy?
If your contracts require higher limits – or your exposure is higher – an umbrella can increase limits above underlying liability policies.
What’s the fastest way to get started?
Send your product/services summary, revenue range, where you sell/serve, and your current policy (if you have one). We’ll guide the rest.
Talk to an Agent
If your business sells products, provides professional services, or both – whether locally near Plymouth, Westland, or nationwide – we can help you clarify what coverage you have today and evaluate whether it matches your real-world risk.
