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 New Jersey, businesses involved in the manufacturing, selling, or distribution of products may consider purchasing product liability insurance as a safeguard against potential lawsuits arising from product-related injuries or property damage. This type of insurance can provide coverage for claims based on various legal theories of product liability, such as design defects, marketing defects (including failure to warn), and manufacturing defects. New Jersey's product liability laws hold any party in the product supply chain potentially liable for damages caused by a defective product. This includes manufacturers, distributors, and retailers, as well as contractors and suppliers in the construction industry. The insurance can help protect a business's financial interests by covering legal fees, settlements, and court-awarded damages. While not legally required, product liability insurance is a prudent investment for businesses to mitigate the risks associated with product-related claims.