Dutch product liability insurances future
Creating Dutch product liability insurances will be a tour de force to create a new balance between UK en EU. If something is wrong with your product that you have sold, and a buyer encounters property damage of personal injury, you may be liable as a producer. Due to the departure of the United Kingdom from the EU, product liability also changes. To get a clear understanding of the future situation you have look from different perspectives of Dutch product liability insurances:
UK-based company selling products in EU-zone.
Your product liability in the current situation will differ as soon UK is a third country producer. A customer can claim his financial damages directly as the producer if your product is the cause of an accident or damage. Dutch Product liability insurers will be reluctant to incorporate these risks in their insurances.
EU-based company selling products in the UK
Before, the UK is within the EU-zone. Therefore, your product liability before the transition is that you are an inside EU producer. A UK-customer can claim a financial loss directly if your product is cause of an accident or damage. This is also due to the current European legislation. Product liability insurers have clauses which incorporate these product liability insurances.
Retailers and consumers in the UK en the other EU countries are always allowed to sue you directly if there is a product liability. Retailer who sell your products are not liable can be transfer the claim to the EU producer.
The product liability after transition
1. You are a UK-based company and sell your products in the EU-zone.
Your product liability is that you are an outside EU producer, a Third Country producer. A customer can’t claim a financial loss directly if your product is the cause of an accident or damage. The EU-seller (retailer) will be sued. European legislation does not have any legal base in the UK. It will be difficult for a European to legally challenge you for your product liability. He will try to get his compensation by suing the seller (of your) product. That seems a nice relief for the responsibility of the company based in the UK. But the EU-retailer will think twice before selling UK-goods.
- Because of the legal consequences and
- Because the EU-insurer will abandon the liability cover for goods produced in the UK as an outside producer. The quality and the safety regulation may be not aligned with the EU-zone. So therefore, the insurer will decline cover for a product liability insurance.
2. You are a EU-based company and sell your products in the UK.
After the transition the UK is outside the EU-zone. Therefore, your product liability at this moment is that you deliver to an outside country. A UK-customer will first put his claim to the UK retailer of your product. The retailer of your product won’t be pleased because they didn’t produce the product. But the possibility that you, as a EU-producer, can be held financial liable, will be difficult to enforce. Of course, retailers and consumers in the UK are always allowed to sue you but it will be legally complicated if they are not situated within the EU-zone. Most UK-retailers will try to find domestic products to replace the EU-products.
What to do ?
Dutch product liability insurances
Are you an importer of products from the UK, check your company product liability insurances? Make sure that your new “own” liability for those products is correctly insured on those insurances. Make sure your (Dutch) insurance policy is up to date. This is essential for Dutch retailer who will get liable if they sell UK products and get sued if there a liability occurs with a Third country product, such as the UK will be in the future.
Assess the contractual relationships with trading partners in the United Kingdom en vice versa. Check which liability risk is run by your company if a property damage or personal injury is caused by a product from the United Kingdom and vice versa. Contractually, this must be clearly and legally enforceable. Presumably you can no longer call for the help of the European Court of Justice in disputes. Through our legal assistance insurers we can help to draw up the right contracts and delivery conditions with the United Kingdom of the EU countries as a new outside importer.
Dutch product liability insurances before and after exiting EU
Be aware of the consequences of “old” claims from the period before and after the transition. Often a claim appears many years later in a different time and with different legal consequences.