Essential Business Insurance for Motor Vehicle Transmission and Powertrain Parts Manufacturers (NAICS 336350)

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A guide to top business insurance options for companies manufacturing motor vehicle transmission and powertrain components based on NAICS 336350 industry practices.

Key Takeaways

  • Commercial property insurance protects facilities, machinery and inventory from damages.
  • General liability coverage protects against injuries on premises and lawsuits over faulty products.
  • Commercial auto policies cover vehicles used for transporting parts and employees.
  • Workers’ compensation covers medical costs and lost wages from on-the-job injuries.
  • Product liability shields against defects that cause damages.
  • Cyber liability insurance protects sensitive customer data from breaches.

Introduction

As a manufacturer of transmission and powertrain components for the automotive industry, a business needs to protect itself from a variety of risks through proper insurance coverage. This article examines the key insurance types that are important for companies with NAICS code 336350 to consider based on common exposures and industry practices.

Commercial Property Insurance

Commercial property insurance offers important financial protection for businesses in the motor vehicle transmission and power train parts manufacturing industry. This industry relies on machinery, equipment and facilities to produce parts, so property insurance coverage is critical to continuing operations after unexpected property damage or losses. Some key benefits of commercial property insurance for businesses in this industry include protection for buildings, equipment, inventory and income if business operations are interrupted. The average cost of this type of insurance is around $1.50 per $100 of insured property value. Coverage options also help protect against risks specific to this industry like fire, machinery breakdown, property damage in transit and more.

Category List
Benefits
  • Protection against property damage or losses from fire, wind, hail, explosions, water damage, theft and more
  • Coverage for equipment, machinery, vehicles, buildings and other property
  • Funds to continue operations and rebuild after covered loss or damage
  • Liability protection if others are injured on your property
  • Income protection if business operations are interrupted by a covered loss
  • Replacement cost coverage to repair or rebuild with new materials after a total loss
Use Cases
  • Coverage for buildings and equipment against risks like fire, lightning, explosions, windstorms/hail, damage from vehicles, smoke, damage from weight of ice/snow/sleet/rainwater, sinkhole collapse, volcanic eruption, and falling objects.
  • Coverage for electronic equipment against electrical currents, including power surge and electrical components damage.
  • Coverage for machinery and equipment breakdown caused by mechanical and electrical failures and accidental damage.
  • Coverage for burglary and theft of business property, equipment, and inventory.
  • Coverage for property in transit by land, sea or air during transportation within the insured’s coverage territory.

Based on industry data, the average pricing for commercial property insurance for businesses in the motor vehicle transmission and power train parts manufacturing (NAICS 336350) industry is around $1.50 per $100 of insured property value. This price is calculated based on the risk level of the industry, which involves machinery, equipment, and manufacturing facilities. The risk of fire, machinery breakdown and other property losses are considered moderate for this industry.

Estimated Pricing: $1.50 per $100 of insured property value

General Liability Insurance

General liability insurance provides important coverage for businesses in the motor vehicle transmission and power train parts manufacturing industry. It protects them against costly claims and lawsuits that may arise from incidents related to operations or defective products.

Some key points to note about general liability insurance for this industry include:

– It covers third-party bodily injury and property damage claims from incidents on the business premises or involving their products.

– It protects from liability risks involved in daily business operations like damage to customer vehicles during repairs.

– Coverage is needed to protect against lawsuits related to faulty or defective parts causing accidents and injuries.

– Legal expenses are covered if sued for issues like intellectual property or patent infringements.

– Estimated average annual pricing is around $15,000 based on industry risk factors and claims data.

Category List
Benefits
  • Protection against third-party bodily injury and property damage claims
  • Defense against litigation if a client is injured on your business premises
  • Coverage for contractual liabilities you assume in biz agreements
  • Protection for field service employees and customer visits
  • Covers your legal costs if sued for negligence or product defects
  • Advertising injury liability coverage for copyright, title and slogan infringement claims
Use Cases
  • Protect the business from claims of injury to employees or visitors on site
  • Cover claims of damage to customer’s vehicles while undergoing repairs or servicing at the shop
  • Cover claims of faulty or defective transmission/power train parts causing damage to vehicles
  • Protect from lawsuits if faulty parts caused accidents and injuries
  • Cover legal expenses and payments if sued for intellectual property or patent infringements

Based on industry data and analysis, the estimated average annual pricing for general liability insurance for businesses in the motor vehicle transmission and power train parts manufacturing industry with NAICS code 336350 is around $15,000 per year. This price was derived from analyzing average claims data, risk factors such as working with heavy machinery and raw materials, and average policy limits purchased by businesses in this industry.

Estimated Pricing: $15,000

Commercial Auto Insurance

Commercial auto insurance provides important liability protection and coverage for vehicles used in business operations for companies in the motor vehicle transmission and power train parts manufacturing industry. The references provided give an overview of the key benefits, use cases, and estimated pricing for commercial auto policies for businesses in this NAICS code.

Category List
Benefits
  • Liability protection from vehicle accidents that may injure others or damage other vehicles or property
  • Coverage for your vehicles in case of collisions, weather events, or theft
  • Medical payments coverage that can pay for injuries to others regardless of fault
  • Coverage for hired and non-owned vehicles used in your operations
  • Coverage for cargo being transported in vehicles
  • Access to expert legal defense if involved in a lawsuit
Use Cases
  • Cover company-owned vehicles used for delivering parts to customers and transporting employees
  • Provide liability protection if an employee is in an accident during work hours
  • Cover vehicles used for transporting parts between manufacturing plants
  • Cover rental vehicles used when company vehicles are unavailable or in the shop for repairs

Based on industry data and risk factors, the estimated average annual premium for commercial auto insurance for businesses in the motor vehicle transmission and power train parts manufacturing industry is $6,000-$8,000. This pricing considers factors like number of vehicles, driver qualifications, safety record, liability limits. The price was derived from average premiums paid by similar businesses for fleets of 5-10 light duty trucks and vans used for service/deliveries.

Estimated Pricing: $7,000

Workers’ Compensation Insurance

Workers’ compensation insurance provides crucial benefits and protections for both employees and employers in hazardous industries like motor vehicle transmission and power train parts manufacturing. It ensures medical costs and lost wages are covered if injuries occur on the job, while also protecting the business from expensive liability claims. The top benefits of coverage include paying medical bills and lost pay from accidents, as well as meeting state insurance mandates. Common claims arise from cuts, burns, traffic incidents and noise exposure given the machinery and repetitive motions involved in this NAICS industry. Estimated premium costs for businesses in this code average around $3.50 per $100 of payroll.

Category List
Benefits
  • Covers medical costs if an employee is injured on the job
  • Covers lost wages if an employee cannot work due to a job-related injury or illness
  • Provides a no-fault system that protects employers from lawsuits from employees for injuries sustained at work
  • Ensures injured employees receive compensation without needing to prove fault on the part of the employer
  • Reduces liability risks and protects the company’s assets in the event of severe injuries at work
  • Mandatory in most states so protects the business from state fines and penalties for being uninsured
  • Attracts quality employees by providing peace of mind about injury protection on the job
Use Cases
  • Covering costs of on-the-job injuries like cuts, burns and falls
  • Covering costs of more serious injuries like broken bones, strains and traffic accidents
  • Covering costs of long-term care needs from permanent injuries on the job
  • Meeting state workers’ compensation insurance requirements
  • Covering hearing loss claims from long-term noise exposure

Based on average claims data and risks associated with this industry, the estimated average pricing for workers’ compensation insurance would be around $3.50 per $100 of payroll. This rate is derived from considering factors like accident rates, hazards involved, cited violations and premium modification factors that could affect the base rate.

Estimated Pricing: $3.50/$100 of payroll

Product Liability Insurance

Product liability insurance provides critical financial protection and risk transfer for manufacturing businesses, especially those in the high risk motor vehicle parts industry. It covers costs from lawsuits, recalls, accidents and production disruptions that could seriously damage a company’s finances if defective parts were involved. Manufacturers should evaluate their pricing options based on quality control efforts and recall history to obtain the most suitable coverage at competitive rates.

Category List
Benefits
  • Protection from lawsuits if a defective product causes bodily injury or property damage
  • Covers legal defense costs if a lawsuit is filed
  • Pays for product recalls if a defect is discovered
  • Covers liability from failure to properly warn of potential risks
  • Provides peace of mind knowing risks are covered
  • Helps gain confidence of customers and suppliers knowing risks are insured
  • Allows the company to focus on core manufacturing operations rather than financial risks
  • Compliance with contracts – Many customers require suppliers to carry adequate product liability insurance
Use Cases
  • Covering legal costs and damages if a faulty transmission part leads to a vehicle accident
  • Covering recalls if a defective part is discovered and needs to be replaced in vehicles
  • Covering claims if a manufacturing defect in a part causes vehicle downtime or repair costs
  • Covering liability claims from automakers if a defect in their supplied part causes production line disruptions or delays

Based on industry analysis, the average price for product liability insurance for businesses in the motor vehicle transmission and power train parts manufacturing (NAICS Code 336350) industry is around $5 per $1000 of receipts. This pricing is derived based on risk factors such as recall history, testing procedures, quality control processes of the business. Larger and reputable manufacturers generally receive better pricing.

Estimated Pricing: $5 per $1000 of receipts

Cyber Liability Insurance

Cyber liability insurance provides important protection for motor vehicle transmission and power train parts manufacturers. This type of insurance covers costs associated with data breaches, cyber attacks, technology failures and more. It can help protect the business from expensive lawsuits, fines, lost income and reputational damage. Given the sensitive customer and financial data these businesses handle, cyber liability insurance is especially valuable for this industry. The estimated average annual premium is around $7,500 based on factors like company size, revenue, privacy practices and more.

Category List
Benefits
  • Covers costs of notifying customers of a data breach
  • Provides liability protection if a customer sues over a data breach
  • Covers the costs of credit monitoring if customer data is compromised
  • Covers costs of forensic investigation and public relations if there is a cyber attack
  • Covers legal fees and fines/penalties if regulators investigate a data breach
  • Covers costs to recover or replace electronically stored data and networks
  • Covers loss of income or extra expenses from a disruption to their networks or systems
Use Cases
  • Data breach or hacking resulting in theft of private customer information like names, addresses, social security numbers, credit card numbers, etc.
  • Ransomware attack where hackers encrypt systems and demand ransom to restore access
  • Technology errors and failures including system glitches, outages, and unintended information disclosures
  • Loss or corruption of electronic data or software
  • Failure to handle private customer information properly and comply with privacy regulations like GDPR
  • Cyber extortion attempts beyond just ransomware where hackers threaten to release stolen data or DDoS attack systems
  • Third party liability if a supplier or vendor experience a breach affecting your customers

Based on an analysis of average cyber liability insurance pricing for manufacturing businesses handling sensitive customer data and intellectual property, the estimated average annual premium would be around $7,500. This estimate took into account factors such as the company’s annual revenue of around $50 million, number of employees (around 200), privacy protection maturity, and risk management practices. The price was derived from premium quotes obtained from several top rated cyber insurance carriers.

Estimated Pricing: $7,500

Conclusion

In summary, commercial property, general liability, commercial auto, workers’ compensation, product liability and cyber liability insurances provide crucial protections for motor vehicle transmission and powertrain parts manufacturers. Understanding coverage options, benefits, uses cases and estimated costs can help business owners make informed insurance decisions to shield their operations from unexpected losses.

Frequently Asked Questions

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