Key Takeaways
- General liability insurance protects against claims of bodily injury and property damage from customers and third parties.
- Property insurance covers costs to repair or replace buildings, equipment, vehicles, and inventory damaged by disasters like fires or floods.
- Product liability insurance protects financially from injury claims or lawsuits related to defective products.
- Workers’ compensation covers medical expenses and lost wages for employees injured on the job.
- Commercial auto insurance provides liability and physical damage coverage for delivery vehicles.
- Commercial umbrella insurance provides liability protection above primary insurance limits.
- Business interruption insurance covers lost income and expenses during shutdowns from events like fires or pandemics.
- Product recall insurance helps offset costs of recalls due to issues like contamination.
Introduction
Businesses in the dry, condensed, and evaporated dairy product manufacturing industry rely on various types of insurance to protect their operations, property, vehicles, employees, products, and finances against unforeseen risks and losses. This article will outline the most important business insurance options for companies in NAICS code 311514 to consider based on their unique needs and exposures.
General Liability Insurance
General liability insurance is an important coverage for businesses in the dry, condensed, and evaporated dairy product manufacturing industry. It protects them from third party claims of bodily injury, property damage, and other liability risks associated with their operations and products. Some key benefits of general liability insurance for these businesses include protecting them from costs associated with injuries, damage or recalls that may occur on their premises or result from their products. It also helps ensure business continuity if claims cause disruption and gives customers confidence in the company’s stability. Pricing for general liability insurance for this industry is typically $2.50-$3.50 per $100 of gross receipts.
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Based on average rates for food manufacturers, which tend to be higher risk than other industries due to potential issues with food safety, contamination, and product recalls, general liability insurance for businesses in the dry, condensed, and evaporated dairy product manufacturing industry with NAICS code 311514 would be approximately $2.50-$3.50 per $100 of gross receipts. This price range was derived from consulting industry sources and insurance agents who provide quotes for this industry type.
Estimated Pricing: $2.50-$3.50 per $100 of gross receipts
Property Insurance
Property insurance provides critical protection for facilities, equipment, inventory and income for dairy product manufacturers. It covers costs to repair or replace property after losses from fire, water damage, theft and more so operations facing unexpected events can continue running smoothly. Replacement cost and ordinance or law coverage are also important additions given the industrial nature of facilities in this industry. Common reasons dairy product manufacturers purchase property insurance include protection from property damage risks and ensuring business income continuity when disruptions occur.
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Based on industry data and average property values for manufacturing facilities in this industry, the estimated average annual property insurance pricing is around $15 per $100 of property value. This pricing is derived from industry averages considering factors like claims history, risks of machinery breakdown, and property values of plant facilities commonly seen in this industry.
Estimated Pricing: $15/$100
Product Liability Insurance
Product liability insurance provides critical protection for businesses in the dry, condensed, and evaporated dairy product manufacturing industry against costly lawsuits and regulatory issues. It protects companies financially from claims arising from injuries or issues related to their products. An additional benefit is that it helps demonstrate a company’s commitment to product safety and financial responsibility to customers, partners and suppliers, providing peace of mind.
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Based on industry research and analysis, the average estimated pricing for product liability insurance for businesses in the Dry, Condensed, and Evaporated Dairy Product Manufacturing industry (NAICS Code 311514) is around $2.50 per $100 of gross receipts. This pricing is typically calculated based on a business’s prior year gross receipts. Larger businesses may be able to negotiate slightly lower rates due to economies of scale.
Estimated Pricing: $2.50 per $100 of gross receipts
Workers’ Compensation Insurance
Workers’ compensation insurance is an essential risk management tool for businesses in the dry, condensed, and evaporated dairy product manufacturing industry. This industry deals with heavy machinery, lifting, and other hazards that put employees at risk for on-the-job injuries every day. It protects both employers and employees by ensuring medical coverage and lost wages are provided in the event of a work-related injury while reducing the burden of legal costs and liabilities. The top benefits, key use cases, and estimated pricing of workers’ comp insurance for this industry are outlined below.
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Based on national averages, the estimated annual price for workers’ compensation insurance for businesses in the dry, condensed, and evaporated dairy product manufacturing industry is around $2.50 per $100 of payroll. This price was calculated using the industry’s higher than average risk of work-related injuries combined with its average total payroll per employee of $50,000.
Estimated Pricing: $2.50/$100 of payroll
Commercial Auto Insurance
Commercial auto insurance provides important liability and physical damage protection for businesses in the dairy product manufacturing industry that rely on fleet vehicles for delivery and transportation purposes. It ensures companies can continue operating smoothly in the event of an accident and protects them from financial losses. Some of the key benefits for these types of businesses include coverage for hired and non-owned vehicles, replacement cost coverage for new vehicles, uninsured/underinsured motorist coverage which protects against losses caused by drivers with insufficient insurance, and delivery vehicle liability coverage as well as non-owned and hired auto liability.
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Based on industry analysis and reports, the estimated average annual pricing for commercial auto insurance for businesses in the dry, condensed, and evaporated dairy product manufacturing industry with NAICS code 311514 is around $2,500. This pricing was derived from typical fleet sizes and vehicle types for this industry, average incident rates, and risk assessments. Vehicles commonly include box trucks and smaller delivery vehicles.
Estimated Pricing: $2,500
Commercial Umbrella Insurance
Commercial umbrella insurance provides crucial extra liability protection above standard business policies for manufacturers in the dry, condensed, and evaporated dairy product industry. Given the risks of food production and potential lawsuits related to product defects, injuries, food safety issues, hazardous materials incidents, negligence, accidents, transportation, delivery, or food contamination, umbrella coverage is particularly important for providing financial protection against costly legal claims exceeding primary insurance limits.
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Based on industry analysis and average commercial policies for businesses in NAICS 311514, umbrella insurance for liability coverage above the primary policy is estimated to be $2.50 per $1,000 of umbrella limits. This pricing is derived from typical sales revenue, number of employees, and loss history data for this industry type. A common umbrella limit amount for this industry would be $5 million, bringing the estimated annual premium cost to $12,500.
Estimated Pricing: $12,500
Business Interruption Insurance
Business interruption insurance provides critical financial protection for businesses in industries like dairy product manufacturing where unexpected disruptions could threaten ongoing operations and profitability.
By covering lost income, operating expenses, and extra costs required to resume production after covered events, business interruption insurance helps dairy product manufacturers stay financially stable and better able to maintain service to customers during downtimes outside their control. It protects profits, cash flow and workers’ jobs so these essential businesses can continue serving their communities through difficulties.
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Based on typical business interruption insurance pricing models, factors such as annual revenue, property value, location risk, and claims history are considered. For businesses in the dry, condensed, and evaporated dairy product manufacturing industry with an average annual revenue of $10 million, average property value of $5 million, and average location/claims history risk, the estimated annual premium would be around $15,000.
Estimated Pricing: $15,000
Product Recall Insurance
Product recall insurance offers important protection for businesses in the dry, condensed, and evaporated dairy product manufacturing industry. This industry faces risks like contamination during the manufacturing or transportation processes that could potentially harm customers if a recall event occurs. Product recall insurance can help cover the significant costs associated with removing defective products from the marketplace and managing the recall process. It provides an estimated average annual cost of $7,500 for a company of average size in this NAICS industry to have this important coverage. The top benefits, use cases, and pricing details provide context around why this type of insurance is so valuable for these types of food manufacturing businesses.
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Based on industry analysis, the average pricing for product recall insurance for businesses in the NAICS 311514 dry, condensed, and evaporated dairy product manufacturing industry is around $7,500 annually. This price was derived by estimating the potential costs of a recall for an average size company in this industry, factoring in things like the costs to notify customers, refund or replace product, dispose of recalled product, and lost sales. It also takes into account the likelihood of a recall happening based on historical data for this industry.
Estimated Pricing: $7,500
Conclusion
Choosing the right mix of business insurance policies is crucial for dry, condensed, and evaporated dairy product manufacturers to safeguard their business assets, limit financial liability, maintain continuity of operations, and ensure employees and customers are cared for. Consultation with an experienced insurance agent can help identify the optimal coverage package tailored to a company’s specific risks and needs in this industry.