If a business manufactures, sells, or distributes products, it may want to purchase product liability insurance to protect against loss due to liability for personal injuries and property damage alleged to have been suffered by someone who used or was affected by a product.

Any business in the product supply chain—a manufacturer, distributor, or retailer—may be sued on one or more legal theories generally known as product liability—including the defective design of a product (design defect); the defective marketing of a product (marketing defect or failure to warn); or the defective manufacturing of a product (manufacturing defect).

Product liability insurance is also purchased by manufacturers, suppliers, and contractors in the construction industry to protect against claims that a product used in a construction project was defective.

In Maryland, businesses involved in the manufacturing, selling, or distribution of products should consider obtaining product liability insurance as a safeguard against potential lawsuits. Product liability refers to the legal responsibility that these businesses may bear if their products cause injury or property damage. Claims can arise from various issues, such as design defects, manufacturing defects, or marketing defects (including failure to warn). Maryland law, in line with general principles of product liability, allows for legal action against any party in the product's supply chain. This includes manufacturers, distributors, and retailers. The construction industry also recognizes the importance of this insurance, as manufacturers, suppliers, and contractors may face claims related to the use of defective products in construction projects. Product liability insurance can provide financial protection against the costs associated with defending these claims, including legal fees, settlements, or judgments.