The Hidden Risks Your Business Faces Without Product Liability Insurance in 2025

Product liability insurance is one of the most important — yet most overlooked — types of business insurance in 2025. If your business manufactures, sells, distributes, installs, or repairs products, you can be held legally responsible for injuries or damages caused by those products… even if the problem wasn’t your fault.

This article explains what product liability covers, who needs it, and why skipping this policy could put your entire business at risk.

1. Any Product Can Cause a Claim — Even If You Didn’t Make It

You don’t need to be a manufacturer to face liability.

Many claims come from:

• Faulty electrical goods

• Safety equipment that doesn’t perform correctly

• Food products causing allergic reactions

• Tools or machinery that injure a user

• Furniture that collapses

• Faulty parts used in repairs

If your business touched the product in any way, you can be held responsible.

2. Claims Can Cost Tens or Hundreds of Thousands

Product liability claims often involve:

✔ Medical bills

✔ Legal expenses

✔ Compensation for injury

✔ Property damage

✔ Product recall costs

Even a small claim can financially cripple a business that isn’t covered.

3. More Industries Will Require It in 2025

Large retailers, e-commerce platforms, wholesalers, and contractors are increasing insurance requirements.

You may be asked for product liability insurance to:

• Sell your products online or in-store

• Supply to major retailers

• Install equipment

• Provide repair or maintenance services

• Tender for government or commercial contracts

Without insurance, you may lose access to entire markets.

4. It Protects Your Business Reputation

In 2025, consumers expect accountability.

If a product causes harm, your insurance ensures:

✔ The injured customer is compensated

✔ Your legal costs are covered

✔ Your business doesn’t collapse

✔ You can maintain your brand reputation

5. Peace of Mind for Growing Businesses

Whether you’re a start-up, online seller, contractor, or supplier, product liability insurance ensures you are protected as your business scales.

If you need help choosing the right level of product liability insurance, our team can guide you through the best options for your business in 2025.