Product Liability Flashcards
What is product Liability
covers claims by those who suffer or loss when using products that are defective or dangerous or who suffer harm in accident caused by them.
lodged against…
manufacturers or sellers of such products, incorrectly or fail to make them properly
give me examples of defective product
dangerous - defective design or formulation
motor vehicle being unstable or a drug having harmful side effects.
- manufacturing defects in product that would have been safe. if they had been properly made.
What is product recall
product recall insurance reimburses policyholders for financial losses sustained when a product is recalled
product recall can be
involuntary and voluntary
involuntary - required by the government and voluntary (the manufacturer notices a defect that is unlikely to force a an involuntary recall
what is product guarantee
is there to cover the cost of dealing with a product that fails to meet the function or specification for which it was manufactured or supplied.
Why can products be recalled from the market
product tampering, contamination, defective products.
product recall events can damage a companies reputation and brand true or false
TRUE
BUSINESS AT RISKS OF PRODUCT RECALL
;PHARMECUTICAL, MEDICAL DEVICE MANUFACTURING , RESTURANTS, FOOD AND BERVERAGE AND CONSUMER GOODS.
REGULATORY OVERSIGHT EXPANDINDING THIS CAUSES CONSUMER PRODUCTS …..
TO FALL SHORT OF EXACTING SAFETY AND QUALITY STANDARDS.
PRODUCT RECALL COVER COSTS ON
DIRECT RECALL COSTS, REPLACEMENT COSTS, LOSS OF REVENUE OR CONTRACT, CONSULTANCY COSTS AND THIRD PARTY FINANCIAL LOSS
PRODUCT GURANTEE
AN INSURER THAT DOES UNDERWRITE THE RISK IS EFFECTIVELY GURANTEEING THAT PRODUCTS ARE OF GOOD QUALITY AND NOT SIMPLY PROTECTING THE INSURED FROM LOSSES THAT ARE ACCIDENTAL IN ORIGIN.
PRODUCT GURANTEE INTRODUCES MORAL HAZARD HOW
INSURED FIRMS COULD SKIMP ON QUALITY CONTROL CHECKS.
REMEBER FIRST PARTY IS EXTENDED WARRANTY ON COSUMER PRODUCTS SUCH AS ELECTRONICS AND HOME APPLIANCES NOT LIABILITY INSURANCE
THE CUSTOMER BUYERS PROTECTION AGAINST THE PRODUCT FAILING.
