Learn how leather manufacturers insurance helps leather industry manufacturing businesses protect themselves against the many complex risks they face every day. Whether your business is large or small, or you make one or many products - you need the right commercial insurance program to protect you.
Leather Manufacturers Insurance
Leather Manufacturers Insurance. Leather products manufacturers receive processed animal hides from tanneries and convert them into a wide range of goods including luggage, handbags or purses, sporting goods, straps, upholstery, and decorative items. The process consists of designing the item, developing patterns, cutting or punching the individual pieces, lacing or sewing the parts together, applying trims or clasps, treating or finishing and then the packaging for shipment.
Leather apparel manufacturers receive processed animal hides from tanneries and convert them into a wide range of apparel for men, women, infants and children. The process consists of designing the item, developing patterns, cutting or punching the individual pieces, lacing or sewing the parts together, applying trims or clasps, treating or finishing, then packaging for shipment.
Although some automation may be possible in the cutting process, the sewing of individual items is a labor-intensive process. Because of the varieties of materials and processes involved in production, the different phases of manufacture may be carried out in different locations or different countries.
If you own a leather manufacturing business, then you must do ensure that your business is safe. Leather production is the process of using raw skins or hides and turning them into leather. During the process of leather manufacturing, you'll be using machinery and chemicals. These machines and chemicals can cause harm to the people working in your business and the environment. As a result of, you must ensure you have the proper leather manufacturers insurance in place to protect your business.
Dangers Of Chemicals Used In The Tanning Process
Although there are many risks involved in the manufacturing of leather, the biggest risk is the damage done to the environmental. The waste that comes from tanneries is filled with pollutants such as lime sludge, sulfides, salt and other acids. This makes the risk of cancer for people who live close to tanneries. For this you reason you must protect your business with leather manufacturing insurance.
Types Of Leather Manufacturing Insurance
Environmental Liability Insurance: Over the years the federal government has implemented different legislations in an attempt to cut down the dangerous emissions and pollutants coming from leather manufacturing plants. This has caused many tanneries to find safer ways of processing and finishing hides. Some businesses found it easier to move their operations to different countries. However, this wasn't the case for all companies and the ones who stayed figured their general liability insurance would cover the costs that came with pollution cleanup. Unfortunately, insurance companies excluded environmental claims from being a part of their general liability policy plan.
Fortunately, environmental liability policies were created to cover where general liability plans didn't. Although many companies in the tanning industry have done their best to clean up, they still use many dangerous chemicals. The simplest mistake can be very costly for the environment surrounding the operation. Without having this type of leather manufacturing insurance, tanneries have no protection if they are responsible for any harm caused to the environment.
Commercial Property: Perhaps you use buildings for your operation. In that case, you must make sure you have insurance for these buildings. With commercial property insurance, the buildings and other assets you use for your business are covered. This insurance covers any damage to equipment and machinery inside the buildings you own.
Business Interruption Coverage: Having this type of insurance protects the earnings of your business. It also helps the covering of expenses if there's a period where your business is unable to operate. This insurance covers any disruption to your business.
Commercial General Liability: Any time negligent action on the part of your business causes bodily harm or injury to a third party you're protected if you have commercial general liability insurance. This insurance offers coverage for things such as attorney fees, court costs, settlements and judgments within the limits of your current policy.
Equipment Breakdown: There will be times in your business where the machinery you use breaks down. Protect your business when it does by having equipment breakdown insurance. Whatever expenses come as a result of machinery breakdown is covered by this insurance.
Product Liability: If for any reason your product causes harm to another person or a bystander this insurance covers the costs associated. This type of insurance will cover things such as medical expenses, compensatory damages, attorneys fees and economic damages.
Commercial Auto: Vehicles are usually a part of most operations. Having this insurance protects the vehicles you use in your business. This insurance protects against in company vehicles. If an employee uses their vehicle for your business, then you need hired or non-owned insurance coverage.
Workers Compensation: Workers' compensation is one of the most important parts of your insurance coverage. Running this type of operation presents man opportunities for the injury of employees. Having workers' compensation covers you for any costs associated with the injury of employees. And in most states it is required for any non-owner employees. If injury results in medical attention then this insurance covers it. If injury results in a fatality then this coverage pays benefits to the surviving family.
Leather Products Manufacturing's Perils And Risks
Property exposures consist of an office, production plant, and warehouse for raw materials and finished goods. Ignition sources include electrical wiring, heating systems, and production machinery. Chemicals used in dyeing, finishing or tanning are often flammable and should be properly labeled, separated, and stored in approved containers. Cutting, punching, and buffing operations generate dust which can catch on fire. This hazard increases in the absence of well-maintained dust collection systems.
Loose fibers and scraps from processing leather are combustible and will add to the fuel load. Leather is susceptible to damage by fire, smoke, water and humidity. 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 machinery) can cause a fire without a separate ignition source. High-valued leather items are particular targets for theft.
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 due to the relatively high street value of leather items. 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. 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. Because of the high market value of leather goods, vehicles should be locked, fitted with alarms, and not left unattended once loaded or during transport.
Premises liability exposure is normally low due to limited access by visitors. If the manufacturer has a showroom or offers tours, visitors may be injured by slips, trips, or falls. Chemicals used in the tanning and finishing may be corrosive and/or toxic. Fumes, spills or leaks may cause serious injury or property damage to neighboring premises.
Products liability exposure varies depending on the items produced. Exposures could be light for handbags or purses, but heavy for sporting goods or safety and restraining straps. Warranties and guarantees should be reviewed. Quality control is important, including thorough inspection and documentation. Governmental regulations, guidelines, and standards must be observed.
Environmental impairment exposure is light unless the manufacturer performs any dyeing, finishing, or tanning. 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.
Business 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.
Workers compensation exposures can be moderate to high. Injuries from production machinery are common, as are puncture wounds, burns, cuts, slips, trips, falls, foreign objects in the eye, hearing loss from machinery noise, 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. Flammable liquids and chemicals used for dyeing, finishing or tanning can cause skin irritation, eye irritation, and possible long-term occupational disease.
The high volume required for production schedules may lead workers to remove guards from the machinery or to postpone maintenance and repair. Repetitive motion injuries can result from the ongoing use of machinery. Workstations should be ergonomically designed.
Safety consciousness and commitment of management, especially in the form of ongoing enforcement and awareness programs, are important considerations. A large amount of the piece work may be done by individuals whose status (employee or independent contractor) must be clear.
Leather Manufacturers Insurance - The Bottom Line
We hope this article on leather manufacturers insurance has been informative. A liability lawsuit is expensive and very time consuming. Having the right commercial insurance polices protects your business income and assets. To find the best insurance for your business, speak with an experienced insurance broker.
Further Reading On Manufacturing & Product Liability Insurance
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