Excluding products Insurance refers to a policy provision that explicitly removes coverage for claims related to the products a business manufactures, sells, or distributes. This exclusion ensures that the insurance policy focuses on other aspects of the business, such as operations and liabilities, while leaving product-related risks uncovered.
Auto dismantling firms, auto salvage yards or scrapyards should consider stand-alone Product Liability Insurance to cover potential risks associated with recycling and disposing of end-of-life vehicles while at the same time obtain general business insurance which can include important coverages such as:
What is Auto Dismantling (Excludes Products)?
When a policy says it “excludes products,” it means product-related claims — for example, a part sold later that fails and causes damage — are not covered under that policy. Auto dismantling operations still face many on-site and off-site exposures such as property damage, environmental contamination, commercial auto exposure, and worker injuries; those are typically addressed through other commercial liability and property coverage forms.
Who needs it
Operators, scrapyard owners, recyclers and parts retailers who dismantle or sell used vehicle components commonly seek specialized coverage. If you run an auto salvage facility, consider reviewing resources like Auto Dismantlers (Auto Salvage Yard) Insurance or the industry-specific overview at Auto Dismantling and Recycling Industry Insurance (Class Code 91190) to compare typical protections. Employers should also evaluate separate policies for employee risks; see information on Workers Compensation Insurance for Auto Dismantlers.
What it typically covers
Typical coverages (outside product exposures) include general liability for third‑party bodily injury or property damage, property coverage for buildings and stock, environmental liability for pollution events, commercial auto for vehicles used in operations, garagekeepers and garage liability for customer vehicles, and workers' compensation for employee injuries. Commercial umbrella policies can provide higher limits to respond to larger liability claims.
Common exclusions or limitations
Aside from product exclusions, policies may limit coverage for pollution, intentional acts, professional services, or certain subcontracted operations. Underwriting factors such as prior claims, storage of hazardous materials, and transportation risks can lead insurers to impose endorsements or higher deductibles. A typical risk scenario: a transported core part dislodges in transit and causes a third‑party accident — that exposure may fall under commercial auto or be excluded if related to a product sale.
Factors that influence cost
Premiums depend on revenue, payroll, claims history, the amount and type of on-site hazardous materials, safety programs, security measures, and how much product sales contribute to income. Risk management practices — documented employee training, environmental controls, and vehicle maintenance — can reduce underwriting risk and lower costs.
Proof of insurance & compliance
Many customers, haulers or regulatory bodies will request certificates of insurance or specific endorsements. Maintaining written procedures, pollution controls and updated coverage declarations helps demonstrate compliance and manage exposures. For industry-specific guidance, see the Auto Dismantling and Recycling resources linked above.
How to get a quote
To compare options and determine whether you need a separate product liability policy in addition to general business coverages, gather basic business details (operations description, payroll, vehicle list, sales mix) and loss history. To start, request a quote and work with an agent to identify gaps between operations and existing policy exclusions.
Frequently Asked Questions
What does “excludes products” specifically remove from coverage?
It typically removes liability for claims arising from products you manufacture, sell or distribute — for example, a part later causing injury or damage. Other on-site or operational liabilities can still be covered under separate sections.
Do I still need product liability if I only sell a few used parts?
Possibly. Even low-volume sales can create exposure if a part causes damage. Discuss your specific sales activity with an agent to decide whether a standalone product liability policy is appropriate.
Can workers' compensation and garagekeepers cover all my risks?
Workers' compensation covers employee injuries and garagekeepers covers customer vehicles in your care, but neither typically covers product-related lawsuits or some pollution claims — those require separate or endorsed coverages.
Still have questions? Talk to a local insurance expert.