Learn how plastic manufacturers insurance helps plastic 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.
Plastic Manufacturers Insurance
Plastic Manufacturers Insurance. Plastics manufacturers produce malleable pellets or sheets from raw materials and sell their products to fabricators who convert these into a wide variety of commercial and domestic goods The raw materials are chiefly ethylene and propane which are refined from crude oil, then heated and combined with a catalyst to create several types of polymer in liquid or powdered form. The polymers may be combined with each other or with additives before being formed into pellets or extruded into sheets and cooled by water or air.
Plastics goods manufacturers produce a wide variety of products including component parts for domestic or industrial goods, films for photographic or X-ray use, foams, large sheets for general use in construction, transportation or insulation, light furniture, marine equipment, packaging materials, plumbing materials, sheathing, sausage casings, bottles, component parts for domestic or industrial goods, fabrics, kitchenware, novelties, packaging materials, plumbing materials, sporting goods, and toys.
They use molding, forming, or extruding processes to turn raw plastic into finished goods. While they do not make the actual plastic, they bore, cut, or punch products or their component parts from "profile shapes" received from plastics manufacturers. These "profile shapes" include plates, rods, sheets, or tubes.
Raw plastic can be in powder, liquid, flake, or pellet form. It is blended or mixed with a wide range of additives, resins, colorants, and catalysts, heated, then molded, formed, or extruded into an end product. The end use of the product determines the mixtures and composition of the blends.
Owning a business in the plastic manufacturing industry means your business is responsible for making plastic parts and plastic products. You need to make sure your business is protected from things such as equipment breakdown, defective parts, weather, fire and employee injury. As with any other business, many things can go wrong, but you can be prepared for them with the right insurance. Get the plastic manufacturer insurance coverage that will keep your business protected.
Safety In The Plastics Business
Making sure your customers and employees are some of the the most important parts of your business. There are many risks involved in the manufacturing of plastics - and because of that commercial insurance protection is must have. Lawsuits against your company can put you in a position where you could lose everything. To avoid this happening, you must protect it with plastic manufacturing insurance.
Types Of Insurance For Plastic Manufacturers
Here are a few of the various insurance plans you can use to protect your plastics operation:
- Commercial General Liability - With this type of plastic manufacturing insurance, you're protected from third party lawsuits. This coverage also helps with attorney fees, court costs, settlements, and judgments independent they are within the limits of your policy. A lawsuit could destroy your business which makes having this insurance important.
- Commercial Auto - If you have vehicles, you use for your business, having commercial auto insurance helps you to keep them covered. This insurance gives you coverage for any property damage or liability claims caused by a vehicle of your business. It also helps with vehicle damage and medical bills that may be a result of an accident in one of your company vehicles.
- Product Liability - If your product causes injury to any user anywhere in the supply chain, this coverage will keep you covered. This is one of the most important coverages for any manufacturer.
- Commercial Property - Many things can happen when you are operating a plastics manufacturing plant. The type of material you work with is flammable and can be destroyed by natural disasters, theft or vandalism. Having commercial property insurance helps to protect your buildings, and other assets use for your business. You an also get coverage for loss of inventory, equipment and machinery, warehouse and office space. With commercial property insurance, you normally get business interruption coverage. If there is ever a period where your business is unable to operate because of an interruption, then you are covered when you have this insurance for your business.
- Inland Marine - Having this coverage protects your when there is damage to your products while being transported from one place to another. It also covers if you are shipping products overseas and they are damaged in the process.
- Equipment Breakdown - Equipment breakdown insurance covers the different costs associated with the failure of equipment in your business. A breakdown could be the result of power surges, motor burnout, or machine age.
- Workers Compensation - To create a safe place for your employees, you must have this insurance in place. In fact, it is required by most states for any non-owner or partner employees. There are many risks of being injured when working in a plastics manufacturing plant. With workers comp coverage your business is protected if an employee gets injured. Any medical cost associated with injury is covered when you this coverage. If there ever comes a time when an employee tries to sue your business then by having this type of insurance you're covered when it does. If injury results in a fatality then benefits will be paid to the surviving family if this insurance is in place.
Plastic Products Manufacturing's Perils And Risks
Property exposure consists of an office, production plant, and a warehouse for storage of raw materials and finished products. Ignition sources include electrical wiring, heating systems, production machinery, buildup of static electricity, and dust explosions.
If the stock catches fire, it can be very difficult to extinguish and will cause a great deal of smoke damage. Molten plastic can carry the fire great distances and into crevices. The chemicals must be adequately controlled, separated, and stored. Nearly all aspects of the operation present fire hazards that can only be minimized by separation and fire suppression systems.
Machinery needs proper maintenance to prevent overheating and wear. Fuel sources to run machinery and to heat the plant must be adequately controlled. Poor housekeeping 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.
Equipment breakdown exposures include malfunctioning production equipment and electrical control panels and other apparatus. A lengthy breakdown to production machinery could result in a severe loss, both direct and under time element.
Crime exposure comes from employee dishonesty. 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), goods in transit, and valuable papers and records for customers' and suppliers' information. The main perils are collision, upset, fire, or theft. There may be contractors' equipment such as forklifts or heavier equipment used to move raw materials and finished goods.
Premises liability exposures at the plant are normally low as access by visitors is limited. If tours are given or if outsiders are allowed on premises, visitors may be injured by slips, trips, or falls. Raw materials and chemicals used in processing may be corrosive and/or toxic.
Fumes, dust, and noise from production could affect neighbors. Should a fire occur, the difficulty in extinguishing it could result in the release of toxins plus smoke damage to neighboring properties. Evacuation plans should be on file with the fire department. The storage of raw materials or finished goods outdoors can create an attractive nuisance.
Products liability exposure is low as the product is being shipped to manufacturers who produce the finished goods. Quality control is very important. If a customer orders a particular type of plastic, such as with fire retardant qualities, it must meet all specifications or the end product may not function as planned.
Environmental impairment exposure is high due to possible contamination of ground, air, and water from raw chemicals, solvents, and fuels. The raw materials are flammable and may be toxic. The catalysts may be caustic, and the final product is usually not biodegradable. Disposal procedures must adhere to all EPA and other regulatory standards.
Business auto exposure is high if the manufacturer assumes responsibility for the transport of raw materials or finished products. If raw chemicals are transported, potential contamination due to overturn or spillage is high. Transporting the final product is less hazardous unless there is a fire. Hazards are substantially higher without proper controls, including any required Hazardous Material licenses and spill containment procedures and equipment.
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 are very high. Injuries from production machinery are common, as are minor cuts, puncture wounds, burns, slips, trips, falls, foreign objects in the eye, back injuries from lifting, hearing loss from noise, and repetitive motion losses. More serious hazards come from chemical usage that can cause injury to eyes, skin, and lungs. Workers should be made aware of potential problems and may need periodic monitoring for cumulative exposure.
Employees should be provided with safety training and protective equipment. Workstations should be ergonomically designed. 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. If there is a fire on premises, the fumes in the smoke are very dangerous and can cause severe respiratory distress. Ventilation systems are needed to prevent the buildup of toxic vapors. Dense smoke makes egress from the premises difficult.
Plastic Manufacturers Insurance - The Bottom Line
We hope this article on plastic manufacturers insurance has been informative. For you to protect your operations you must be sure you have the right plastic manufacturing insurance policies in place. For you to get the right coverage, you must figure out for what risks you want to protect your business against. Talking to an experienced commercial insurance broker can help. Taking this simple step can protect your business from being destroyed if you are ever sued.
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