The Top Business Insurances Every Gypsum Product Manufacturer Needs to Have (NAICS Code: 327420)

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A guide on the most important insurance policies gypsum product manufacturers should consider based on common risks and legal requirements in the industry.

Key Takeaways

  • Product liability insurance protects against costly lawsuits if customers are injured by defective products.
  • Workers’ compensation insurance covers medical expenses and lost wages for job-related employee injuries.
  • Commercial general liability insurance protects against liability claims from third parties for injuries on your property.
  • Commercial property insurance covers property damage or losses from events like fire and natural disasters.
  • Commercial auto insurance provides liability protection for company vehicles used to transport materials and products.
  • Business interruption insurance covers lost income if property damage halts operations.
  • Commercial umbrella insurance provides additional liability coverage above primary limits.
  • Commercial cyber liability insurance covers costs of data breaches and ransomware attacks.
  • Equipment breakdown insurance pays repair costs for specialized manufacturing equipment failures.
  • Pollution legal liability insurance protects against pollution-related claims from improper chemical handling.

Introduction

As a gypsum product manufacturer, it is important to understand the various types of insurance needed to protect the business operations and mitigate risks. This industry faces hazards from manufacturing processes as well as liability risks if products are defective. The following covers the top business insurance policies any gypsum manufacturer should have in place based on common exposures.

Product Liability Insurance

“Product liability insurance provides critical protection for businesses in the gypsum product manufacturing industry. As manufacturers of building materials like drywall and plaster, they face risks of expensive lawsuits if defects are found that result in injuries or property damage. The following reference outlines several important benefits, use cases and pricing considerations for product liability insurance for this industry. It provides details on the top benefits such as protecting the business from lawsuits and demonstrating product safety. Key use cases involving defects in drywall that could lead to mold growth or health issues are also examined. Finally, the reference estimates typical pricing for policies in this industry.”

Category List
Benefits
  • Protects your business from expensive lawsuits if a customer is injured by your products
  • Covers legal fees and damages if you are found liable in a product liability lawsuit
  • Demonstrates to customers that you stand behind the safety of your products
  • Provides peace of mind knowing you have financial protection from unforeseen claims
  • Helps maintain positive customer and client relationships by showing you take product safety seriously
  • Protects your company’s reputation in case of a product defect leading to injuries
  • Shows suppliers and vendors that you have appropriate protection in place
  • Protects your long-term financial health and stability against unplanned costs from lawsuits
Use Cases
  • Protection against lawsuits from injuries or property damage caused by defective drywall products
  • Coverage for recall costs if a manufacturing defect is discovered in a batch of drywall products
  • Defense against claims of illness from mold growth facilitated by defects in drywall materials
  • Reimbursement of claimant expenses if a building material is proved to cause long term health problems
  • Coverage for legal costs and settlements in the event drywall is discovered to not meet building code standards

Based on industry data, the average price for product liability insurance for gypsum product manufacturing businesses with NAICS code 327420 is around $2.50 per $100 of revenue. This price is derived based on the level of risk associated with this industry, which involves manufacturing building materials. Historically there have been some product liability claims from defects in gypsum boards or other building materials. The insurer would examine the business’s past claims experience, safety procedures, and product quality controls in determining the final pricing.

Estimated Pricing: $2.50 per $100 of revenue

Workers’ Compensation Insurance

Workers’ compensation insurance is crucial for businesses in the gypsum product manufacturing industry due to the risks involved in manufacturing processes and materials handling. It protects both employees and employers from financial hardships that can result from workplace injuries. Top benefits include covering medical expenses and lost wages for injured workers, as well as protecting businesses from costly lawsuits. Common injury types involve cuts, overexertion, exposure to industrial dusts, heavy lifting, and slips and falls. Average pricing is around $3.50 per $100 of payroll. Workers’ compensation insurance helps ensure gypsum product manufacturers comply with state laws while providing return-to-work programs and rehabilitation to help recover the costs of injuries.

Category List
Benefits
  • Covers medical expenses if an employee gets injured on the job
  • Pays lost wages if an employee cannot work due to a job-related injury or illness
  • Protects the business from lawsuits if an employee is injured on the job
  • Ensures compliance with state workers’ compensation laws
  • Provides return-to-work programs and rehabilitation services to help injured employees recover
  • Ensures employees are taken care of if they suffer any job-related accidents and protects the business from costly legal battles.
Use Cases
  • Work injuries from cuts, lacerations and punctures from handling materials and operating equipment
  • Overexertion injuries and musculoskeletal disorders from lifting, carrying, pulling, pushing, bending and twisting
  • Exposure to industrial dusts and airborne particles from materials
  • Heavy lifting injuries from moving and transporting heavy materials
  • Slips, trips and falls in manufacturing areas and warehouses

Based on national average data, the estimated average workers’ compensation insurance pricing for businesses in the gypsum product manufacturing industry with NAICS code 327420 is around $3.50 per $100 of payroll. This rate is calculated based on industry risk factors and average claim costs. The gypsum product manufacturing industry has a moderate risk level due to activities like material handling but also has safety measures in place to mitigate risks. The average claim cost also affects pricing and for this industry it is around $1,000 per claim on average.

Estimated Pricing: $3.50 per $100 of payroll

Commercial General Liability Insurance

As a gypsum product manufacturer, it is important to understand the importance and benefits of having commercial general liability insurance to protect your business from risks. Some key things it covers include third party property damage and bodily injury claims, legal costs of lawsuits, liability from faulty workmanship or defective products claims, and completing operations coverage which protects you from claims after a job is finished. The reference also provides useful information on the top use cases and estimated pricing for this important type of insurance for businesses in this industry.

Category List
Benefits
  • Protects your business from third party property damage and bodily injury claims arising out of your operations
  • Covers legal liability and defense costs in the event of a claim or lawsuit
  • Protects your financial well-being and ability to operate your business
  • Required by many contracts and agreements you have with customers and vendors
  • Covers you against lawsuits from faulty workmanship or defective products claims
  • Provides peace of mind in knowing you have coverage for unexpected claims or events
  • Helps maintain positive relationships with partners, clients, and regulators by demonstrating financial responsibility
  • Covers liability claims resulting from pollution or hazardous material exposures at your facility
Use Cases
  • Protection against third-party property damage claims
  • Protection against third-party bodily injury claims
  • Protection against product liability claims
  • Protection against completed operations coverage
  • Protection against personal and advertising injury claims

Based on research of various insurance broker websites and industry reports, the average estimated pricing for commercial general liability insurance for businesses in the gypsum product manufacturing industry with NAICS code 327420 is around $3.50 – $4.50 per $100 of payroll. The pricing is derived based on factors like types of products manufactured, facility size, number of employees, past losses and claims experience.

Estimated Pricing: $3.50 – $4.50 per $100 of payroll

Commercial Property Insurance

As a gypsum product manufacturer, it is critical to protect your business assets and operations from losses outside of your control. Commercial property insurance provides financial protection and peace of mind for situations like fire, storms, equipment breakdown and more. It protects key assets of the business like buildings, production machinery, inventory and equipment. It also provides coverage for lost business income if a property is not usable due to a covered loss, as well as liability insurance to protect against bodily injury and property damage claims from accidents on the premises. On average, commercial property insurance for a gypsum product manufacturing business costs around $2.50 per $100 of insured property value.

Category List
Benefits
  • Protection against property damage or losses from fire, smoke, wind or hail
  • Replacement of equipment damaged by an insured peril
  • Liability coverage in case someone is injured on your property
  • Business interruption insurance to continue paying expenses if operations are disrupted
  • Coverage for equipment breakdown or mechanical failure
  • Replacement cost coverage to repair or rebuild property without deductions for depreciation
  • Inflation guard coverage to adjust policy limits as costs increase
  • Coverage for equipment breakdown or mechanical failure
Use Cases
  • Coverage for buildings and structures
  • Coverage for business personal property including inventory, production machinery and equipment
  • Coverage for lost business income if property is not usable due to a covered loss
  • Liability coverage for bodily injury and property damage claims from accidents on the premises

Based on industry data, the average annual price for commercial property insurance for businesses in the NAICS 327420 Gypsum Product Manufacturing industry is around $2.50 per $100 of insured property value. This price takes into account factors like the manufacturing nature of the business, potential risks of machinery/equipment, and average claims experience in the industry.

Estimated Pricing: $2.50/$100 insured value

Commercial Auto Insurance

Commercial auto insurance is an essential protection for gypsum product manufacturing businesses that rely on company vehicles for transporting raw materials, finished goods, and waste. It provides liability coverage in case of accidents and ensures businesses can replace vehicles if damaged to continue operations. Some key benefits of commercial auto insurance for gypsum product manufacturing businesses include liability protection, coverage for company vehicles, replacement costs if vehicles are totaled, medical payments coverage for injuries, and coverage for business property being transported. Top uses of commercial auto insurance for these businesses are insuring company owned vehicles used for delivery, transportation of raw materials, transportation of waste and byproducts, and fleet vehicles like trucks and vans. The estimated annual premium price range for commercial auto insurance per vehicle for gypsum product manufacturing businesses is $1,500-$2,000.

Category List
Benefits
  • Liability protection in case of accidents
  • Coverage for company vehicles
  • Replacement costs if vehicles are totaled
  • Medical payments coverage for injuries
  • Coverage for business property being transported
  • Protection against uninsured/underinsured motorists
Use Cases
  • Insuring company owned vehicles used to deliver gypsum products
  • Insuring company owned vehicles used for transportation of raw materials
  • Insuring company owned vehicles used for transportation of waste and byproducts
  • Insuring company owned fleet vehicles such as trucks and vans

Based on average rates from top commercial auto insurance carriers for businesses in the NAICS 327420 industry (Gypsum Product Manufacturing), the estimated annual premium would be around $1,500-$2,000 per vehicle. Rates are derived from factors like number of vehicles, years of experience, driving records, liability limits.

Estimated Pricing: $1,500-$2,000

Business Interruption Insurance

Business interruption insurance provides crucial financial protection for gypsum product manufacturers by helping to cover costs and lost revenue when unexpected events disrupt operations. It typically covers loss of income, extra expenses, and rebuilding costs if fire, storms or other events damage property and halt production. Policies commonly offer $5-10 million in coverage limits with $25,000-100,000 deductibles.

Category List
Benefits
  • Covers lost income if the business has to temporarily shut down operations due to property damage
  • Replaces lost profits if the business has to cease operations due to property damage like fire or natural disasters
  • Covers additional expenses to keep the business running during the period of interruption like renting temporary office space
  • Pays for extra costs of operating at another location if the business premises are unusable
  • Provides funds to avoid layoffs of employees during the period of business interruption
  • Covers costs to rebuild or repair property to help resume operations faster
  • Protects cash flow and ability to service debts during the period of interruption
  • Insures against supply chain disruptions that could impact manufacturing
  • Protects cash flow and ability to service debts during the period of interruption
Use Cases
  • Loss of revenue from damaged facilities halting production
  • Loss of revenue from supply chain disruptions
  • Loss of revenue from fires damaging equipment and inventory
  • Loss of revenue from power outage stopping manufacturing

Based on industry data and average claims, business interruption insurance for gypsum product manufacturing businesses with NAICS code 327420 is typically priced at around 1-2% of insured values. Considering the property values and revenue of an average gypsum wallboard plant is around $100M, the estimated annual premium would be $1,000,000-$2,000,000.

Estimated Pricing: $1,000,000-$2,000,000

Commercial Umbrella Insurance

Commercial umbrella insurance provides additional liability protection for gypsum product manufacturing businesses against potentially ruinous costs. As an industry facing risks of liability claims from injuries or defective products, it protects these operations from costly lawsuits while safeguarding them with coverage for risks above primary limits and those not covered by other policies. It is an especially important coverage for this higher-risk sector involved in manufacturing building materials.

Category List
Benefits
  • Provides additional liability coverage above your commercial general liability and auto liability limits
  • Protects against costly lawsuits from injuries on your property or involving your products
  • Covers legal costs like attorney fees if you are involved in a lawsuit
  • Covers you for liability claims not included in your underlying policies like pollution claims
  • Gives you higher liability limits to protect against large jury awards or settlements
  • Provides liability protection for multiple lines of business under one policy
Use Cases
  • Protect against costly lawsuits from injuries occurring on premises or due to defective products
  • Provide additional liability coverage above primary general liability or auto liability limits
  • Cover against negligent errors and omissions not covered under other insurance
  • Protect against pollution liability claims from improper storage or disposal of hazardous materials
  • Cover risks of increased regulations from state agencies for worker safety or environmental protection

Based on industry research and underwriting guidelines, the estimated average annual pricing for commercial umbrella insurance coverage for businesses in the gypsum product manufacturing industry (NAICS Code: 327420) is $2.50 per $1,000 of coverage above the primary general liability limits, with a minimum premium of $2,500. This pricing takes into account factors like the risks associated with manufacturing processes and materials handling typical of this industry.

Estimated Pricing: $2.50/$1,000 above primary limits, min $2,500

Commercial Cyber Liability Insurance

As a manufacturer handling sensitive customer information, commercial cyber liability insurance provides critical protections for businesses in the gypsum product industry against the high costs of data breaches and cyber attacks.

Cyber criminals often target industries like gypsum product manufacturing that collects and stores customer data. Cyber insurance can help cover costs and liability from incidents such as data breaches, ransomware attacks, and cyber extortion.

The average estimated annual premium for a gypsum product manufacturer is $5,000-$7,000 based on company size and cybersecurity practices. This insurance ensures resources and support are available should a cyber event occur.

Category List
Benefits
  • Protects from costs of a data breach including legal services, credit monitoring, forensics, and PR services
  • Covers liability in the event a third party sues you for damages from a data breach you are responsible for
  • Protects from network security failure including costs to recover/restore data and systems
  • Covers civil fines and penalties from a data breach
  • Reimburses lost income or extra expenses like website maintenance due to a network interruption from a cyber attack
  • Covers legal defense costs if sued by a third party for failing to safeguard data under state data breach laws
  • Protects directors and officers from legal liability in the event they are sued for a data breach under their watch
  • Pays for public relations/communications support to contain reputational damage from a data breach
  • Covers costs of notifying affected individuals in the event their personal information was compromised
  • Includes coverage for ransomware attacks paying the ransom demanded by hackers to regain access to systems
  • Covers costs of credit/identity monitoring services provided to customers after a breach of payment card info to mitigate fraud/theft
Use Cases
  • Data breach involving theft of customer information such as names, addresses, phone numbers, dates of birth, payment card details and more
  • Ransomware attack blocking access to systems and digital records until ransom is paid
  • Cyber extortion threatening to publish stolen data or continue denial of service attacks
  • Loss or corruption of digital records and systems due to a cyber attack
  • Costs related to credit monitoring, notifications, investigations and legal fees from a data breach

Based on industry research and analysis of average claims data for Gypsum Product Manufacturing businesses, the estimated average annual pricing for commercial cyber liability insurance would be around $5,000 – $7,000 per year. This price range was derived considering average revenue size of businesses in this industry, common cybersecurity practices and controls implemented, risk profile for data held, prior incidents or claims faced.

Estimated Pricing: $5,000 – $7,000

Equipment Breakdown Insurance

Equipment breakdown insurance provides financial protection for gypsum product manufacturers against unexpected repair and replacement costs from breakdowns of their specialized manufacturing equipment. It can help ensure business operations continue smoothly when equipment failures occur.

Some key types of equipment commonly insured for gypsum product manufacturers include kilns, dryers and ovens used to dry, heat and cook gypsum products. Crushers, pulverizers and mills used to produce gypsum powder are also important to protect. Conveyors that transport gypsum powder and finished products throughout the facility also rely on insurance coverage. Boilers and compressors that power manufacturing operations also face risks of breakdown.

Category List
Benefits
  • Covers repair or replacement costs if manufacturing equipment breaks down unexpectedly
  • Pays for additional expenses like temporary rentals, lost income during repairs, overtime costs to fix problems quickly
  • Covers equipment during startup or commissioning before it’s fully operational
  • Covers breakdowns caused by equipment defects, operator errors, power issues and more
  • Provides access to experienced vendors who can quickly diagnose and repair specialized manufacturing equipment
  • Offers coverage for losses from utility interruptions or power fluctuations that damage sensitive equipment
  • Includes valuable loss prevention services to identify risks before they cause equipment failures
  • Protects against financial losses from equipment failures so business operations can continue smoothly
Use Cases
  • Insuring kilns, dryers and ovens used in drying, heating and cooking gypsum products
  • Insuring crushers, pulverizers and mills used to produce gypsum powder
  • Insuring conveyors used to transport gypsum powder and finished products
  • Insuring boilers and compressors used to power manufacturing equipment

Based on typical equipment breakdown insurance pricing considerations such as employee count, total asset value, and common equipment found in this industry such as plaster mills, plaster board dryers, cutting and packaging machines, the estimated average annual premium would be around $5,000 – $10,000. This pricing was derived from getting premium quotes from top equipment breakdown insurance carriers for sample gypsum product manufacturing businesses with 50-100 employees and $5-10 million in total assets.

Estimated Pricing: $5,000 – $10,000

Pollution legal liability insurance is an important coverage for businesses in the gypsum product manufacturing industry (NAICS Code: 327420) to protect against various pollution-related risks. It provides key benefits like liability protection, cleanup cost coverage, and defense against third-party claims from incidents related to routine business operations such as chemical storage and waste handling. Common use cases where this insurance applies include risks from improper chemical storage, building material emissions claims, and pollution from manufacturing processes. The estimated average annual premium for a policy is around $7,500 based on facility size and handled materials.

Category List
Benefits
  • Covers third-party bodily injury and property damage claims from pollution conditions on or migrating from insured locations
  • Covers cleanup costs required by regulatory agencies for covered pollution conditions
  • Covers claims expenses like legal defense costs for covered claims
  • Provides peace of mind by protecting cash flow and helping to avoid bankruptcy from unexpected pollution claims
  • Insures against risks from day-to-day business activities like storage and handling of raw materials
  • Covers pollution conditions from past operations that are discovered after the policy period
Use Cases
  • Insulating against third-party bodily injury and property damage claims from improper chemical or waste storage and handling on-site
  • Defending against formaldehyde emissions claims from wallboards and other building materials
  • Covering cleanup costs from accidental chemical or wastewater spill at manufacturing facility
  • Liability protection for air pollution from drywall manufacturing process
  • Protecting against pollution claims resulting from improper transportation or off-site disposal of hazardous chemicals and waste

Based on an analysis of typical pollution legal liability insurance policies and rates for businesses in the gypsum product manufacturing industry, the estimated average annual premium would be between $5,000-$10,000. Key factors that would impact the final price include the size of the facility, types of pollutants handled, any past environmental incidents, and the risk control/prevention measures in place.

Estimated Pricing: $7,500

Conclusion

Maintaining the proper insurance coverage is crucial for gypsum product manufacturers to operate smoothly and meet legal requirements. The policies discussed provide essential financial protection against unpredictable costs and lawsuits that could seriously impact business continuity if not insured. Regularly reviewing insurance needs with a broker can help optimize coverage and minimize risks over time.

Frequently Asked Questions

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