Is there product liability coverage in a printers' E&O policy?
Coverage Q&A: The insured manufacturers packaging for frozen meat products.
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Editor’s Note: This week’s question concerns the definitions of “printing services or products” and “wrongful act” under an E&O policy.
Question: Our client manufactured packaging to industry standards for frozen meat products. The client sold the packaging for frozen food products to be stored horizontally. Their customer then loaded the packaging with products outside of the industry standards (placed fresh meat and stored the boxes vertically) and sold the products to a third party. Excess moisture went to the bottom and seeped out.
The carrier is providing liability for the lawsuit for property damage, but my client is not being paid for the $100,000 of boxes they made. Their customer used the product according to industry standards from that point forward. The carrier form, “Printers Errors and Omissions Liability Including Correction of Work,” includes coverage for product recall. Would this policy provide coverage for my client’s boxes?
— Wisconsin Subscriber
Analysis: We cannot stress enough the importance of definitions to a policy. Definitions are special terms that give meaning to coverage under the policy, and as such, they carry great weight when ascertaining whether or not there will be coverage for a particular claim under the policy.
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