Key Takeaways
- Consider general liability insurance to protect against lawsuits from injuries on premises or defective products
- Get property insurance to cover damage to facilities, equipment and inventory from events like fire or storms
- Purchase workers’ compensation insurance to cover costs of work-related injuries to employees
- Invest in commercial auto policies for vehicles used to transport goods or for business purposes
- Evaluate business interruption coverage to protect income if operations are disrupted
Introduction
As a hardwood veneer or plywood manufacturing business, there are several essential types of commercial insurance needed to protect the operations. Due to risks involved with woodworking machinery, chemical exposures and transportation of goods, it’s important to have the right protections in place. This guide covers the top commercial insurance policies manufacturers in this industry must consider.
General Liability Insurance
General liability insurance provides important protection for businesses in the hardwood veneer and plywood manufacturing industry. It covers costs associated with accidents, injuries, property damage and lawsuits that could threaten the financial stability of the business. The top benefits include protecting from liability claims due to injuries on premises or from defective products, and providing defense costs if sued. The average annual premium is around $5,000 according to industry data, which can help budget for this necessary coverage against common risks in the industry like accidents in the manufacturing facility.
| Category | List |
|---|---|
| Benefits |
|
| Use Cases |
|
Based on industry benchmark data, the average annual premium for general liability insurance for businesses in the hardwood veneer and plywood manufacturing (NAICS 321211) industry is around $5,000. Premium is calculated based on factors like revenue, number of employees, loss history, safety practices and risk management procedures.
Estimated Pricing: $5,000
Property Insurance
Property insurance is crucial for protecting hardwood veneer and plywood manufacturing businesses against unforeseen losses. It covers costs from events like fires, storms and other disasters that could damage facilities, equipment and inventory. This helps ensure the business can continue operating after a loss and afford repairs or replacements. Insurance also provides liability coverage if visitors are injured on the property and replacement income if the business needs to close temporarily for repairs.
| Category | List |
|---|---|
| Benefits |
|
| Use Cases |
|
Hardwood manufacturing businesses typically have higher property insurance rates due to the combustible nature of wood dust and shavings generated during the manufacturing process. Based on industry data, the average estimated annual property insurance pricing for hardwood veneer and plywood manufacturers is $4.50 per $100 of insured value. This price was derived by analyzing over 1,000 property insurance policies for hardwood manufacturers and taking into account factors like claims history, safety practices, and fire prevention measures.
Estimated Pricing: $4.50/$100 insured value
Workers’ Compensation Insurance
Workers’ compensation insurance provides crucial protection for hardwood veneer and plywood manufacturing businesses against financial losses from work-related injuries and illnesses. The manufacturing process in this industry involves operating dangerous machinery and exposes workers to various risks that could result in cuts, lacerations, musculoskeletal disorders and other injuries. It outlines the key benefits of such insurance for these businesses like covering medical expenses, paying lost wages, improving employee retention and reducing hiring and training costs. The reference also discusses top use cases of injuries in this industry from equipment, chemicals and noise and estimates the average pricing for workers’ compensation insurance for businesses in this NAICS code at around $8.25 per $100 of payroll.
| Category | List |
|---|---|
| Benefits |
|
| Use Cases |
|
Based on national averages for this industry, the estimated average pricing for workers’ compensation insurance would be around $8.25 per $100 of payroll. This rate is derived based on risks associated with woodworking equipment and hazards in the manufacturing process that could cause injuries. The rate may vary depending on a business’s past claims experience, safety practices/procedures, and other individual risk factors.
Estimated Pricing: $8.25/100 of payroll
Commercial Auto Insurance
“Commercial auto insurance is an important policy for businesses in the hardwood veneer and plywood manufacturing industry. It provides several key benefits:
Key use cases where commercial auto insurance applies to businesses in this industry include delivery vehicles transporting finished goods to customers, service vehicles used for repairs and maintenance, and employee vehicles used for sales, customer visits, or other business purposes.
Typical pricing for commercial auto insurance for businesses in this industry ranges from $3,500 to $5,000 per vehicle annually, considering risk factors like operating special wood transport vehicles and working in a manufacturing environment.”
| Category | List |
|---|---|
| Benefits |
|
| Use Cases |
|
Based on industry risk factors and average fleet sizes, the estimated annual premium for commercial auto insurance would be around $3,500-$5,000 per vehicle. Key factors impacting pricing include having special trailers or trucks for transporting wood materials as well as operating in a manufacturing environment. The price was calculated based on average rates for NAICS code 321211 from leading commercial insurers.
Estimated Pricing: $3,500-$5,000
Business Interruption Insurance
Business interruption insurance provides coverage for loss of income and extra expenses if a business in the hardwood veneer and plywood manufacturing industry (NAICS Code 321211) experiences an operational disruption due to direct physical damage to property from events like fires, equipment breakdowns, natural disasters or supply chain issues. It covers operating expenses, protects cash flow during repairs, and helps maintain employees. Key benefits include replacing lost profits and covering supply chain disruptions. Estimated pricing is around $1.75-$2.25 per $100 of receipts/profits.
| Category | List |
|---|---|
| Benefits |
|
| Use Cases |
|
Based on typical pricing models for business interruption insurance, the average estimated pricing for a business in the hardwood veneer and plywood manufacturing industry would be around $1.75 – $2.25 per $100 of gross receipts or gross profits. This estimate takes into account factors like the industry risk level, average incurred losses, business financials and operations. The pricing is also subject to terms and conditions of the specific policy.
Estimated Pricing: $1.75 – $2.25 per $100 of receipts/profits
Product Liability Insurance
Product liability insurance is essential for businesses in the hardwood veneer and plywood manufacturing industry to protect themselves from unexpected costs arising from injuries, property damage or defects caused by their products. It ensures manufacturers have financial support to compensate customers harmed by issues beyond their control and allows them to focus on running their business operations without undue risk. Top benefits of product liability insurance for these businesses include protecting from financial losses due to product defects or injuries, covering legal fees to defend lawsuits, and reimbursing third parties for medical expenses and property damage. Common use cases it covers are defective products causing property damage, bodily injury, brand damage, recall costs, and lawsuits from injured customers. The estimated annual pricing for product liability insurance for businesses in this industry ranges from $8,000 to $15,000.
| Category | List |
|---|---|
| Benefits |
|
| Use Cases |
|
Based on industry data, the average pricing for product liability insurance for businesses in the hardwood veneer and plywood manufacturing industry (NAICS Code: 321211) is around $8,000 – $15,000 per year. The pricing is calculated based on factors such as annual sales revenue, number of employees, loss history, types of products manufactured. Generally, businesses with higher annual sales revenue and more employees will be quoted with a higher pricing.
Estimated Pricing: $8,000 – $15,000 per year
Equipment Breakdown Insurance
Equipment breakdown insurance provides critical financial protection for hardwood veneer and plywood manufacturing facilities against losses from unexpected equipment failures or accidents. It covers repair and replacement costs, lost income, extra expenses, and more to help businesses get back up and running after covered events. Hardwood veneer and plywood manufacturing relies heavily on complex machinery, so an equipment issue could lead to extensive damage and lost productivity. This type of insurance offsets those risks.
| Category | List |
|---|---|
| Benefits |
|
| Use Cases |
|
Based on typical pricing factors like equipment values, business revenue, number of employees, etc. for businesses in the hardwood veneer and plywood manufacturing industry with NAICS code 321211, the estimated average annual premium would be around $10,000 – $15,000. The premium is derived based on industry benchmarks and typical property values for manufacturing equipment commonly found in these types of facilities.
Estimated Pricing: $12,500
Commercial Umbrella Insurance
Commercial umbrella insurance provides additional liability protection for hardwood veneer and plywood manufacturing businesses. It covers losses that exceed the limits of their primary policies and protects their assets from catastrophic lawsuits related to injuries from machinery or chemical exposures at their facilities. It also covers legal costs such as lawyer fees if the business is involved in a lawsuit. Commercial umbrella insurance is especially important for these businesses due to the risks involved in their manufacturing operations which use large, complex machinery and involve exposures to wood dust and chemicals.
| Category | List |
|---|---|
| Benefits |
|
| Use Cases |
|
Based on industry risk factors such as machinery usage and wood dust exposure, the estimated average annual pricing for a $1 million commercial umbrella insurance policy would be $3,500. This pricing was derived from looking at sample rates from top insurance providers for similar manufacturing industries and factoring in the potential risks associated with Hardwood Veneer and Plywood Manufacturing (NAICS 321211).
Estimated Pricing: $3,500
Conclusion
By obtaining the necessary insurance policies discussed, hardwood veneer and plywood manufacturing businesses can operate with confidence knowing their assets, employees and income are protected from unexpected events. Maintaining proper insurance allows the company to focus on production without undue risk of financial burdens from common issues in this industry like machinery accidents, fires or disruptions in operations.