Learn how rubber goods manufacturers insurance helps rubber goods & pottery 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.
Rubber Goods Manufacturers Insurance
Rubber Goods Manufacturers Insurance. Rubber and rubber goods manufacturers produce a wide variety of products including balls, bands, bumpers, foam, gaskets, hose, sheets, and shields for noise, shock, or vibration control. Bales of natural latex are chopped and mixed with additives, especially sulfur or peroxide for vulcanization, resins, colorants, and other catalysts. The material is then heated, pressed through rollers, and cut, molded, formed, or extruded into end products.
The use of the final product determines the mixtures and the stage of processing at which ingredients are added. While synthetic latex is made from petroleum by-product gasses processed with soapsuds, the other processes are the same as those used for natural latex.
Why Do Rubber Goods Manufacturing Companies Need Insurance?
As mentioned, there are certain risks that are associated with owning any business – including a business in the rubber goods manufacturing industry. The warehouse where you store your goods could be damaged in a storm, your inventory could be stolen, your equipment could be damaged, or a third-party (a vendor or a client, for example) could sustain an injury on your property. These are just some of the risks that you could face as a rubber goods manufacturer.
As the proprietor of your business, you will be held liable for any and all accidents, injuries, damages, and legal claims that may arise. As you can imagine, the costs of these liabilities can be astronomical. Paying for these expenses out of your own pocket could put you in financial ruin. As a business owner, you have enough to worry about without having to deal with the exorbitant costs that are associated with the travesties that could occur, and the financial damage that such issues can cause.
Investing in the right type of rubber goods manufacturers insurance insurance will safeguard you from these types of unexpected financial losses.
Types Of Insurance For Rubber Goods Manufacturers
There are a number of insurance policies that are recommended for business owners in the rubber goods manufacturing industry. Some of the most basic crucial forms of coverage include:
- Commercial Liability – This type of coverage serves as the foundation of protection for your business. It offers a broad range of protection against various types of liabilities, including the medical costs that can arise if a third-party sustains an injury on your property, the damages to someone else’s property that you or an employee caused, and the potential lawsuits that could be associated with such incidents.
- Errors and Omissions – If a client ever claims that your business didn’t meet the obligations that were set forth in a contract, if you or an employee were negligent in any way, or if any oversights or errors occurred in the production of the goods that you make, errors and omissions insurance will cover you. This type of insurance covers any damages that you might have to pay for, as well as the cost of defense fees if legal action is taken.
- Product Liability – Though you do your best to ensure that all of the products you manufacture adhere to the highest quality standards, errors can occur; a product could malfunction and injure a client or cause property damage, for example. Product liability insurance will protect you from any damages that your products may cause. It will also help to cover the cost of legal fees that may arise.
- Workers’ Compensation – This type of insurance covers the cost of medical expenses and lost wages should an employee sustain a work-related injury or illness. For instance, if a piece of machinery that an employee is working with malfunctions and causes an injury, workers’ comp will cover the cost of medical care and the wages that the employee loses while he or she is recovering.
- Commercial Property – This type of coverage protects the physical structure that your business operates out of, as well as the contents within it, including equipment, inventory, and machinery. It protects against things like storm-related property damage, fire, theft, and vandalism. For instance, if someone breaks into your business and steals equipment, commercial property insurance will help to cover pay for any repairs and the replacement of the stolen items.
These are just some of the types of rubber goods manufacturers insurance coverage that rubber goods manufacturing firms should carry.
Rubber Goods Products Manufacturing’s Perils And Risks
Property exposures consist of an office, production plant, and a warehouse for raw materials and finished goods. Ignition sources include electrical wiring, heating systems, production machinery, and the storage of large amounts of chemicals and solvents. While rubber does not ignite easily, the vulcanization chemicals and process can result in a fire that can be very difficult to extinguish due to the heavy black smoke which results in a great deal of smoke damage.
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 the heat plant must be adequately controlled. Cutting, punching, and buffing operations generate dust which can catch on fire. This hazard increases in the absence of properly maintained dust collection systems.
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 causes of loss are collision, upset, fire, and theft. There may be contractors’ equipment such as forklifts or heavier equipment used to move raw materials and finished goods.
Premises liability exposure at the plant is 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. Chemicals used in vulcanization 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 and 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 varies depending on the end usage of the product. Office supplies such as rubber bands pose minimal risks, while the failure of products used for medical supplies, food packaging, or gaskets for high-pressure piping present significant bodily injury or property damage loss potential.
Environment impairment exposure is high due to possible contamination of ground, air, and water from raw chemicals, solvents, and fuels. 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 vulcanization chemicals are transported, potential contamination due to overturn or spillage is high. Hazards are substantially higher without proper controls, such as 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 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, as well as from work with heavy machinery that can cause major cuts and amputations.
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.
Rubber Goods Manufacturers Insurance – The Bottom Line
We hope this article on rubber goods manufacturers insurance has been informative. To find out more about the different types of policies you need and how much coverage you should carry, speak to a skilled insurance broker.