Are you aware that under Australian Consumer Law, importers of products are deemed to be the manufacturer, when the overseas manufacturer does not have an office in Australia?
This means that any client who imports any product or component, even if they don’t directly sell to the end consumer, should have full products liability cover.
Remember as well, that the limit of liability works differently for products liability as opposed to the public liability.
The limit of liability for public liability claims applies to any one occurrence, however, the limit for the products liability section applies to all claims in the policy period(‘in the aggregate’).
Show let’s say our client has a limit of $10,000,000. He has a public liability claim totalling $6,000,000 early in the policy period. He still has $10,000,000 cover for any other public liability claims that arise during the policy period from a separate occurrence.
However, if that $6,000,000 claim was a product liability claim, he would only have $4,000,000 cover left for the remainder of the policy period. So, if you have a client who has a substantial product liability claim, speak to the insurer about reinstating the limit of liability, to ensure your client still has cover for the full policy limit for the remainder of the policy period.