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Product Liability Vs. Professional Indemnity – Which is Better for You?

People usually get confused while differentiating between Professional Indemnity, General Liability along with Product Liability Insurance.

BUT…..All three are equally important.

Time to tell you everything about all of the insurance policies and their benefits.

Professional Indemnity Insurance

This insurance offers coverage for professionals that are from corporate sector or own their own businesses. It is better for you to get a free review of your insurance at the very first place before buying it so that you may not have any doubts later.

This insurance aids in situations when an act of negligence happens or error occurs while performing professional duties or activities. Certainly, indemnity insurance differs from Product & General Liability coverage.

pI insurance

You can collect details from professional indemnity insurance qld based insurance providers and how it can help offer protection to your business.

This insurance policy covers those acts that are performed by an engineer, architect, doctor or attorney in delivering specialized services to their clients.

To make you better understand this insurance policy, I have briefly explained below about both Product Liability and Professional Indemnity along with the application of the latter and how it functions.

A. Product Liability: Product Liability is the legal responsibility of a manufacturer to a consumer for his product. Liability arises out of the negligent manufacture of a product including defective or faulty workmanship, materials or components. It is a liability that arises from the failure of a manufacturer to properly manufacture, test or warn about its product and accident that occurs when the product departs in a negligent manner from its intended function.

Product Hazards includes bodily injury or property damage arising out of the named insured’ products. Insurance covers damages only if the bodily injury or property damage occurs away from the premises owned or leased by the named insured and after physical possession of the products has been relinquished to others and is in the stream of commerce.

After reading this article, you can gather more details from various online resources to clear your doubts, if their is any.


B. Professional Indemnity: PIP or Professional Indemnity Policy is specifically designed to cover the professional services prohibited in the Product/CGL Liability Policy.

This policy covers the careless services offered by a professional to his or her client and covers an act of carelessness, blunder or oversight on the part of certain individual in the implementation of his professional activities.

Such type of professional activities generally comprises of design, calculations, the drafting of specification, viability studies, with maps and regulation of same by the certified professional.

It even covers the lawful Liability to reimburse a 3rd party who has suffered loss, sustained injury or any sort of damages due to the dereliction of a duty. It is owed to 3rd parties as a result of a careless act, error or omission in the rendering of professional services by the assured.