How Manufacturers Choose the Right Business Insurance Coverage
- Nate Jones, CPCU, ARM, CLCS, AU
- 3 hours ago
- 2 min read
Choosing the right business insurance coverage is a critical decision for manufacturers. With high-value equipment, complex supply chains, and potential product liability exposure, manufacturers must carefully evaluate risks to protect their operations. Understanding how to select appropriate coverage helps ensure compliance, financial stability, and long-term growth.
Step 1: Identify Manufacturing-Specific Risks
The first step manufacturers take is assessing their unique risk profile. Common risks include equipment breakdown, workplace injuries, product defects, property damage, and business interruptions. Factors such as production methods, facility size, inventory value, and employee count all influence coverage needs.
Manufacturers that proactively identify risks are better positioned to choose insurance policies that address real operational exposures rather than paying for unnecessary coverage.
Step 2: Understand Required and Contractual Coverage
Many manufacturers must carry certain insurance policies to meet legal or contractual obligations. Workers’ compensation insurance is required in most states for businesses with employees, while commercial auto insurance is mandatory for company-owned vehicles.
Additionally, lenders, landlords, distributors, and government contracts often require minimum coverage limits for general liability, property insurance, or product liability insurance. Reviewing these requirements early prevents compliance gaps.
Step 3: Select Core Insurance Policies
Manufacturers typically build coverage around essential policies, including:
General Liability Insurance for third-party injury and property damage
Commercial Property Insurance for buildings, equipment, and inventory
Product Liability Insurance for claims related to defective products
Workers’ Compensation Insurance for employee injuries
Business Interruption Insurance to cover lost income after a covered loss
These policies form the foundation of a comprehensive manufacturing insurance program.
Step 4: Consider Safety and Compliance Factors
Insurers evaluate workplace safety programs when pricing coverage. Following safety standards set by the Occupational Safety and Health Administration (OSHA) can reduce claims, improve compliance, and lower insurance premiums. Manufacturers with documented safety protocols often qualify for better rates.
Step 5: Compare Coverage Options and Providers
Rather than choosing the cheapest policy, manufacturers compare coverage limits, exclusions, deductibles, and claims support. Working with an insurance provider that specializes in manufacturing ensures policies are tailored to industry-specific risks.
Why Manufacturers Choose Wexford Insurance
Wexford Insurance specializes in manufacturing business insurance and helps manufacturers evaluate risks, meet compliance requirements, and select the right coverage mix. Their tailored approach ensures manufacturers receive protection aligned with their operations and growth goals.
Request a free manufacturing insurance quote from Wexford Insurance to get customized coverage built for your manufacturing business.
FAQs
How should manufacturing companies compare business insurance quotes?
What are the most common insurance claims filed by manufacturing companies?
How can manufacturers reduce business insurance premiums without reducing coverage?
