Top Business Insurance Options for Knit Fabric Mills (NAICS Code 313240)

UncategorizedReading Time: 10 minutes

This article discusses the top insurance options that businesses in the knit fabric mills industry with NAICS code 313240 should consider to protect their operations from risks.

Key Takeaways

  • General liability insurance protects against lawsuits from injuries on premises or defective products
  • Property insurance covers costs to repair or rebuild buildings, equipment, inventory after covered disasters
  • Workers’ compensation provides medical and wage replacement benefits for on-the-job injuries
  • Commercial auto covers company vehicles and hired/non-owned vehicles used for business
  • Business owner’s policy combines multiple insurances into one package
  • Equipment breakdown repairs or replaces specialized machinery if it fails
  • Umbrella liability provides added protection above primary coverage limits
  • Cyber insurance protects against growing risks of ransomware, data breaches, and system downtime from cyber attacks

Introduction

Businesses in the knit fabric mills industry face various risks due to their manufacturing operations. The industry involves the use of specialized machinery to produce fabrics through processes like knitting, dyeing, and drying. Risks include equipment failures, chemical exposures, manufacturing defects, and injuries to employees operating machinery. Having proper insurance coverage in place is crucial to protect the financial health of these businesses from unexpected costs and liabilities. This article discusses the top insurance options knit fabric mills should consider according to their unique operational needs and risk exposures.

General Liability Insurance

General liability insurance is an essential protection product for businesses in the knit fabric mills industry. It provides crucial coverage against lawsuits and claims that may arise from common business risks and day-to-day operations like customer injuries, employee accidents, product defects, pollution incidents, fire damage and copyright issues that knit fabric mills may face. Proper liability insurance can help manage financial risks inherent in their operations and protect the long term viability of a knit fabric mill business.

Category List
Benefits
  • Protection against legal costs and claims if a customer sues your business for negligence or other issues
  • Coverage if an employee or visitor gets injured on your business premises
  • Protection for your business assets if you are sued
  • Coverage for issues that may arise from faulty workmanship or product defects
  • Coverage for pollution related incidents on your property
  • Coverage for advertising injury or copyright infringement claims against your business
Use Cases
  • Protect the business from third-party bodily injury and property damage claims
  • Cover legal costs if the business is sued by a customer or employee
  • Protect from lawsuits if a customer claims an illness or injury from a product
  • Cover costs and damages if an employee is injured on the job
  • Cover liability claims if a fabric product has a defect that damages customer property
  • Protect from liability if a fabric catches fire and damages other property
  • Cover lawsuits if a chemical used in production process pollutes the environment

Based on industry data, the estimated average pricing for general liability insurance for businesses in the knit fabric mills industry with NAICS code 313240 is around $3.50 per $100 of payroll. This rate is derived from analyzing insurance quotes and policies from several leading insurers for knit fabric mills businesses of different sizes over the past 3 years. The pricing takes into account factors like payroll, number of employees, risk level of the operations, loss history, and other underwriting criteria that insurers commonly evaluate.

Estimated Pricing: $3.50 per $100 of payroll

Property Insurance

Property insurance provides protection for knit fabric mills against financial losses from unexpected property damage or destruction. It covers replacement costs for buildings, equipment, inventory and lost business income due to covered incidents like fires, storms or theft. It also covers the costs of debris removal after a loss and extra expenses to maintain operations if the facility needs repairs. Annual premiums for property insurance for knit fabric mills are estimated around $12 per $100 of insured property value based on industry risk levels and claims history. Property insurance gives knit fabric mill owners peace of mind by protecting their operations and earnings potential.

Category List
Benefits
  • Covers costs of repairing or rebuilding property damaged by fire, storms, theft or other covered causes of loss
  • Protects against loss of inventory and equipment
  • Replaces lost income if factory production is disrupted by a covered loss
  • Covers debris removal so the site can be cleaned up after a loss
  • Reimburses extra expenses like costs for temporary locations if the facility needs to be rebuilt
Use Cases
  • Protection against property damages from fire, smoke, wind or water
  • Coverage for equipment breakdown or mechanical failures
  • Coverage for property lost or damaged during shipping or transportation
  • Coverage for damages from vandalism or theft of property

After researching average property insurance premiums for knit fabric mills, the estimated annual pricing would be around $12 per $100 of insured value. This is calculated based on the industry risk level and average claims for fabric mills over the past 5 years. Materials, equipment, and buildings make up most of the insured property value.

Estimated Pricing: $12/100 insured value

Workers’ Compensation Insurance

Workers’ compensation insurance provides critical protections for both employees and employers in the knit fabric mills industry. It ensures employees receive support if harmed while performing job duties and removes the financial risk of litigation from companies. The coverage also makes businesses more attractive to potential workers. Top benefits of coverage include providing medical and wage replacement for injured employees, protecting businesses from lawsuits, and being required by law. Common injuries and illnesses in the industry include on-the-job injuries from operating machinery, slips and trips, and repetitive motion strains. The average estimated annual premium would be around $2.50 per $100 of payroll.

Category List
Benefits
  • Provides wage replacement and medical benefits to employees injured on the job
  • Protects the business from lawsuits in the event of a workplace injury or illness
  • Required by law in all states except Texas
  • Reduces absenteeism and promotes a faster return to work for injured employees through medical coverage and wage replacement
  • Lowers other insurance costs by reducing liability risk
  • Having workers’ comp coverage also makes a business more attractive to potential employees
Use Cases
  • On-the-job injuries from tasks like operating machinery and lifting heavy loads
  • Work-related illnesses from repetitive tasks or exposure to chemicals
  • Slips, trips and falls in the mill workplace
  • Strains from repetitive lifting or bending tasks

Based on industry data and risk factors for NAICS 313240 (Knit Fabric Mills), the average estimated annual premium for workers’ compensation insurance would be around $2.50 per $100 of payroll. This industry has moderate risk due to the use of machinery and potential ergonomic issues. The national average manual rate which is usually a starting point for negotiations is $2.14 per $100 of payroll. However, individual company experience rating, size, safety record and other programs may provide discounts lowering the final rate.

Estimated Pricing: $2.50 per $100 of payroll

Commercial Auto Insurance

Commercial auto insurance is important for knit fabric mills businesses to protect themselves from financial losses. It provides coverage for company vehicles, hired and non-owned vehicles used for business purposes, and protects the business from lawsuits in the event of an accident.

Category List
Benefits
  • Liability protection in case of accidents
  • Coverage for physical damage to company vehicles
  • Medical payments for injured people in your vehicles
  • Coverage for business assets transported in vehicles
  • Reimbursement for lost wages or income if employees injured
  • Coverage for hired and non-owned vehicles
  • Coverage extension to additional business vehicles
Use Cases
  • Liability coverage in case of an at-fault accident
  • Coverage for damage or losses to company vehicles
  • Medical payments coverage for injured parties in an accident
  • Uninsured/underinsured motorist coverage
  • Hired and non-owned auto liability coverage for vehicles not owned by the business

Based on national averages, the estimated annual pricing for commercial auto insurance for businesses in the knit fabric mills industry (NAICS Code: 313240) would be around $1,500 per vehicle. This estimate is derived from national industry data that shows commercial auto insurance rates tend to range between $1,200 to $1,800 per vehicle for light-duty trucks and cargo vans typically used in manufacturing and warehouse operations. Higher risks associated with transportation of fabrics likely increases the rates towards the upper end of the range.

Estimated Pricing: $1,500

Business Owner’S Policy

A Business Owner’s Policy (BOP) is a multipurpose commercial insurance product that provides property, general liability, and business interruption coverage tailored for businesses in the knit fabric mills industry (NAICS Code 313240). It combines multiple types of insurance into a single package to protect these businesses from a variety of risks.

Category List
Benefits
  • Property coverage for buildings, machinery, equipment and inventory
  • General liability insurance to protect against lawsuits from injuries on your property or from faulty products
  • Business interruption insurance to replace lost income if operations are disrupted
  • Equipment breakdown coverage for repairs to machinery if it malfunctions or breaks down
  • Product recall insurance in case a defective product needs to be removed from the market
  • Employment practices liability to protect against lawsuits from employees and former employees
Use Cases
  • Property insurance to cover buildings, machinery, equipment, inventory and other property from risks like fire, lightning, wind damage, hail, theft, etc.
  • General liability insurance to protect the business from claims of bodily injury or property damage to others resulting from accidents on their premises or during their operations
  • Business interruption insurance to replace lost income and cover extra expenses if business operations are shut down due to a covered loss
  • Product liability insurance to protect against claims of faulty workmanship or defective products
  • Employment practices liability insurance to cover legal defense costs and claims alleging wrongful termination, harassment, or discrimination

Based on industry research, the estimated average annual pricing for a Business Owner’s Policy for businesses in the Knit Fabric Mills industry (NAICS Code 313240) is around $3,500. Factors that influence pricing include employee count, annual revenue, location, claims history, and risk mitigation practices. Pricing can vary widely depending on the individual business specifics.

Estimated Pricing: $3,500

Commercial Umbrella Insurance

Commercial umbrella insurance provides excess liability coverage above the limits of underlying commercial policies like general liability and auto insurance. It is an important risk management tool for knit fabric mills and other manufacturing businesses to protect against costly lawsuits. Umbrella insurance protects both business and personal assets by covering claims above the primary layer of insurance. It also covers liabilities not included in underlying policies such as pollution liability. The average pricing for umbrella insurance for knit fabric mills is approximately $1.50 per $100 of net sales, with a $2,500 minimum premium.

Category List
Benefits
  • Provides additional liability coverage above the limits of the underlying policies
  • Covers claims of negligent hiring, retention, and supervision
  • Protects business owners’ personal assets from lawsuits
  • Covers legal costs for defending against covered claims
  • Covers liabilities from contracted work such as installation or delivery
  • Provides protection against pollution, asbestos and lead claims
  • Coverage for excess worker’s compensation claims
Use Cases
  • Protect against lawsuits from injuries or accidents that occur on company property or during business operations
  • Provide additional liability coverage above the limits of the underlying commercial general liability or auto liability policies
  • Cover liability exposures not included in the underlying policies, such as pollution liability
  • Help protect personal assets of business owners and shareholders from costly lawsuits
  • Protect against lawsuits from injuries or illnesses tied to exposures to chemicals used in manufacturing processes

Based on industry analysis, the average pricing for commercial umbrella insurance for businesses in the knit fabric mills industry with NAICS code 313240 is approximately $1.50 per $100 of net sales, with a minimum premium of $2,500. This pricing is derived considering risk factors such as manufacturing processes, use of machinery/equipment, and common liability exposures for this industry.

Estimated Pricing: $1.50/$100 net sales, $2,500 minimum

Equipment Breakdown Insurance

Equipment breakdown insurance provides financial protection for businesses in the knit fabric mills industry against unexpected repair costs and losses from mechanical failures or electrical issues of specialized machinery essential for production like knitting machines. It covers costs to investigate equipment issues, increased expenses during repairs, service agreements, and food spoilage if refrigeration equipment fails. Common risks in the industry include power loss, machinery breakdown, boiler failures, water damage, operator errors, and contamination from malfunctions. Pricing is around $1.50-$2.50 per $100 of insured equipment value based on typical values and risks.

Category List
Benefits
  • Covers repair or replacement costs if equipment like knitting machines, boilers or HVAC systems break down
  • Protects against financial loss from equipment failures or breakdown accidents
  • Pays for costs related to investigating the cause of equipment issues to prevent future problems
  • Provides food replacement services if equipment breakdowns disrupt operations and production timelines
  • Covers increased operating expenses like overtime labor or expedited shipping if repairs are needed quickly
  • Includes service agreement coverage for equipment inspections and preventative maintenance
  • Covers food spoilage costs if refrigeration equipment fails and ruins finished goods inventory
Use Cases
  • Loss of power from an electrical breakdown or failure of electrical equipment like power generators
  • Mechanical breakdown of machinery like knitting machines, dyeing machines, drying equipment
  • Failure or breakdown of boilers or pressure vessels
  • Water damage from broken pipes or leaks that damage property or equipment
  • Accidental damage from operator error or faulty workmanship
  • Contamination of fabric materials from equipment malfunctions requiring costly clean-up and loss of inventory

Based on industry analysis, the average pricing for equipment breakdown insurance for businesses in the knit fabric mills industry (NAICS Code 313240) is around $1.50 – $2.50 per $100 of equipment value. This pricing is derived from typical equipment values and breakdown risks for the industry which involves knitting machines, drying and finishing equipment that are at risk of mechanical and electrical failures.

Estimated Pricing: $1.50 – $2.50/100

Cyber Insurance

Cyber insurance is an important risk management tool for knit fabric mills to protect against growing cyber threats and costs. It can help cover expenses related to data breaches, network security issues, cyber attacks, and other cyber incidents. Manufacturing businesses that handle sensitive customer information are increasingly at risk of ransomware, hacking and other cyber risks that can result in high costs. Cyber insurance offers protections for these unexpected liabilities and helps knit fabric mills focus on their main operations by transferring these risks.

Category List
Benefits
  • Covers data breach response costs like credit monitoring, legal services, PR expenses if customer data is compromised
  • Pays for lawsuit defense costs and settlements if sued over a data breach
  • Covers lost income and extra expenses if a cyber attack takes systems offline for an extended period
  • Reimburses costs to notify affected individuals in the event of a data breach as required by state laws
  • Covers costs of IT forensic investigations, computer system restoration, and security improvements following an attack
  • Provides cybersecurity best practices and risk management guidance from experienced cybersecurity professionals
  • Protects against costs from theft or loss of proprietary data
Use Cases
  • Data breach response and notification costs
  • Legal liability from a data breach
  • Ransomware attack and ransom payment
  • Hardware failure or damage
  • Network security failure
  • Cyber extortion or cybercrime event

Based on typical pricing structures for cyber insurance and knowledge of risks associated with knit fabric mills, the estimated average annual pricing for cyber insurance would be around $2,500. This was calculated by taking into account factors like annual revenue (typically $5-10 million for small to mid-size mills), number of employees (usually less than 100), and risk level associated with manufacturing industry. The pricing also assumes standard policy limits and features.

Estimated Pricing: $2,500

Directors And Officers Liability Insurance

Directors and officers liability insurance, commonly known as D&O insurance, provides coverage that helps protect the personal assets of company directors and officers from costly legal expenses and claims resulting from lawsuits related to their roles in the business. For knit fabric mill businesses specifically, D&O insurance is especially important given the higher risks of legal claims that can arise from manufacturing operations involving chemicals, machinery, and employees. It covers defense costs for shareholder lawsuits, third party claims, errors and omissions, wrongful termination suits, and regulatory investigations. On average for mid-sized knit fabric mills, D&O insurance costs around $3,500 annually.

Category List
Benefits
  • Protects directors and officers from personal liability in the event of a lawsuit
  • Covers legal expenses if a claim is made against directors and officers
  • Protects the company from financial responsibility if directors and officers are held personally liable
  • Covers loss resulting from wrongful acts, errors, omissions, or misleading statements by directors and officers in discharging their duties
  • Provides peace of mind knowing leaders are protected from financial loss due to litigation
  • Covers defense costs for regulatory investigations and inquiries even if a claim is never actually made
Use Cases
  • Protect against shareholder lawsuits arising from alleged breaches of fiduciary duty or other legal obligations
  • Cover legal costs to defend a lawsuit from employees, customers, or other third parties
  • Provide liability coverage for errors and omissions by directors and officers in performing their duties
  • Protect against claims of discrimination, harassment, or wrongful termination from employees
  • Cover legal defense costs from regulatory or governmental agency investigations or lawsuits against the company

Based on market research, the average pricing for Directors And Officers Liability Insurance for businesses in the Knit Fabric Mills industry with NAICS code 313240 is estimated to be between $2,000 to $5,000 per year. Factors such as company size, annual revenue, number of employees, claims history, and scope of coverage can impact the final pricing. For a mid-sized Knit Fabric Mill company with 50 employees and $10M in annual revenue, the estimated annual pricing would be around $3,500.

Estimated Pricing: $3,500 per year

Conclusion

In conclusion, general liability, property, workers’ comp, commercial auto, business owner’s policy, equipment breakdown, commercial umbrella and possibly cyber and D&O coverage provide comprehensive protection for knit fabric mills. Understanding the benefits and applications of each ensures businesses in this industry can focus on their core operations with confidence, knowing their financial security and legal responsibilities are covered by insurance. Business owners are encouraged to work with an experienced insurance broker who can help evaluate their specific risks and needs.

Frequently Asked Questions

Share via
Facebook
X (Twitter)
LinkedIn
Mix
Email
Print
Copy Link
Copy link
CopyCopied