If you’ve been involved with a product liability claim, you’re probably wondering: what is product liability insurance?
In this blog post, we’ll cover what product liability claimants need to know about product liability claims and product liability insurance – how it fits into claims and what claimants need to know if a manufacturer doesn’t have it.
We’ll also cover the damages that product liability claimants may be entitled to, depending on the type of action being brought, and other important information about damages in product liability claims.
What are Product Liability Claims?
To understand product liability insurance, it’s important to first learn more about product liability claims.
Safe and reliable products are essential for consumer confidence. So, when a consumer purchases an item and suffers harm due to design, manufacturing defects, or other omissions, they can sue the manufacturer for damages.
Some examples of common product liability claims include the following:
- Design defects: For example, if you are injured in a vehicle rollover that occurred (or was more likely to occur) due to a design defect.
- Manufacturing defects: For example, if a seatbelt breaking injures you due to a manufacturing defect.
- Failure to warn: For example, if you are injured after consuming medication that did not contain a warning regarding potential side effects or interactions.
What is Product Liability Insurance?
Product liability insurance is a type of insurance that specifically covers accidents, injuries, or other damage resulting from products that a manufacturer sells. In a product liability case, the manufacturer’s product liability insurance would likely cover the damages paid by the manufacturer (of course, this depends on the specific terms of the insurance policy).
What Happens If the Manufacturer Does Not Have Product Liability Insurance?
If a manufacturer faces a product liability claim and does not have product liability insurance, they are still responsible for paying damages to the plaintiff. In this scenario, the manufacturer would have to pay out of pocket for the claimant’s damages.
Still, it’s important to know whether the manufacturer has product liability insurance, as it can affect the parties involved in litigation and the manufacturer’s ability to pay.
What Damages Can I Claim in a Product Liability Case?
The types of damages available to claimants in product liability cases can vary wildly, as the impact of a manufacturer’s defect or omission can also vary.
Tort Law and Contract Law in Product Liability Claims
As mentioned in a previous product liability blog post, product liability claims can be brought under contract or tort law.
For contract law cases, the dispute typically arises due to a term of the contract or warranty. The injured party must show that a contract existed and that a breach of a condition or warranty in the contract resulted in a loss.
For tort law cases, the case will be won or lost in negligence. That is, the claimant will need to prove the following:
- the negligent party owed a duty of care to the claimant;
- the negligent party breached the applicable standard of care;
- the injured party sustained damages; and
- the damages were caused by the negligent party’s negligence.
Damages in Tort Law and Contract Law Product Liability Claims
The damages available to claimants can vary between tort law and contract law product liability claims. That’s why it’s essential to consult with an experienced personal injury lawyer when dealing with a product liability claim to ensure you are pursuing your case through the appropriate legal channels.
For example, in a product liability claim based on contract law, you may be able to refuse the contract because a condition of the contract was breached. However, if a warranty in the contract was breached, you may be able to claim damages for any arising loss.
In a product liability claim based on tort law, on the other hand, you will be able to claim damages for any arising loss.
Types of Damages in Product Liability Claims
Product liability claimants can claim “compensatory” and “general” damages.
Compensatory damages are designed to compensate claimants for calculable expenses relating to their loss. Examples include out-of-pocket expenses for medical care, lost income, and loss of future earnings.
General damages, on the other hand, compensate plaintiffs for the pain, suffering, and loss of enjoyment of life associated with their injuries. These damages are not “compensatory” because they lack a strict monetary value. While it’s relatively easy to calculate the amount of lost wages you’ve suffered because of a manufacturer’s negligence, calculating the value of pain and suffering or emotional distress is much more subjective.
In some cases, a product liability claimant may also be able to claim “punitive damages” designed to punish the negligent party for “harsh, vindictive, reprehensible and malicious” behaviour. However, the court rarely awards punitive damages outside of egregious product liability claims.
Caps on General Damages in Product Liability Claims
While Canadian courts recognize and award damages for pain, suffering, and loss of enjoyment of life, there are limits on how much courts will award under this head of damages.
In 1978, the Supreme Court of Canada imposed a cap of $100,000 on general damages ($413,000, when adjusted for inflation). This means the courts cannot award more than the amount specified for general damages in personal injury cases.
Two points warrant further discussion. First, the cap on personal injury damages does not establish a baseline for damages. The cap intends to prevent dramatic increases in the awards for personal injury damages. The “cap”, in some ways, represents what the most seriously-injured personal injury claimant would be entitled to receive. In most cases, personal injury claimants will receive much less.
Second, the cap only applies to general damages – it does not apply to compensatory damages like past loss of income or loss of future earning capacity (which, in some cases, can be extremely high, particularly with young claimants or high-income earners).
Contact the Personal Injury Lawyers at Tierney Stauffer LLP in Ottawa, Kingston, Cornwall & North Bay for Assistance with Product Liability Claims
Suppose a defective product or toy, or a contaminated food product has injured you. In that case, you may be entitled to compensation for the losses you suffer, including pain and suffering, medical or other care costs, and loss of earnings.
Contact the lawyers at Tierney Stauffer LLP to learn how our experienced personal injury lawyers can help you achieve the maximum compensation for your product liability case. We provide our clients with the knowledge and resources to make informed decisions about their claims. Call us at 1-888-799-8057 or contact us online to discuss your matter with an experienced lawyer.