Insurance for Lifting and Handling Equipment Manufacturers: A Complete Guide

Lifting and handling equipment sits at the heart of British industry. From overhead cranes and forklift trucks to conveyor systems, hoists, and custom-built material handling rigs, the products manufactured in this sector keep warehouses, construction sites, ports, and factories moving. But the very nature of this work — engineering heavy, complex machinery designed to bear significant loads — brings with it a level of risk that demands specialist insurance protection.

If you manufacture lifting and handling equipment, your liability exposure does not end when your product leaves the factory floor. It travels with every unit you sell, every installation you oversee, and every maintenance contract you hold. A single equipment failure can result in catastrophic injury, property damage, or death — and when investigations begin, the manufacturer is invariably one of the first parties scrutinised.

This guide explains the risks unique to lifting and handling equipment manufacturers, the insurance covers you should have in place, and how specialist brokers can help you secure the right protection at a competitive premium.

Who Does This Cover Apply To?

Lifting and handling equipment manufacturing is a broad sector. The following types of businesses will find this guide directly relevant:

• Overhead travelling crane manufacturers
• Forklift and reach truck manufacturers
• Pallet truck and hand truck producers
• Conveyor system designers and manufacturers
• Hoist and winch manufacturers (electric, pneumatic, and manual)
• Lifting beam and spreader bar fabricators
• Scissor lift and platform lift manufacturers
• Bespoke material handling system builders
• Dock leveller and loading bay equipment manufacturers
• Vacuum lifting and magnetic lifting equipment producers

Whether you operate as a sole manufacturer, a design-and-build contractor, or a hybrid business that both manufactures and installs, the insurance considerations in this guide apply to your operations.

The Risk Landscape for Lifting Equipment Manufacturers

Understanding the risks you face is the foundation of sound insurance planning. Lifting and handling equipment manufacturers operate across multiple risk dimensions simultaneously.

Product Liability Risk

This is arguably the most significant long-tail risk for any equipment manufacturer. Under the Consumer Protection Act 1987 and general common law principles, UK manufacturers can be held liable for damage or injury caused by defective products — even if the defect arises years after the unit was sold.

For lifting equipment, the consequences of product failure are rarely minor. A crane hook that fractures under load, a forklift mast that collapses, or a hoist brake that fails can result in serious injury or fatality. The injured party — whether an employee of the customer, a member of the public, or a bystander — can pursue a claim directly against the manufacturer, even where the equipment was correctly installed and maintained.

Product liability claims in this sector can run into millions of pounds when you factor in personal injury compensation, loss of earnings, care costs, and property damage. If the equipment was exported, claims may also arise under foreign jurisdictions, potentially with even higher damages awards.

Public Liability Risk

Where your engineers visit customer sites for installation, commissioning, inspection, or servicing, your business creates public liability exposure. An engineer who damages a customer's racking system, injures a site worker, or causes a fire during welding creates liability that sits squarely with your company.

Public liability risk is also present at trade shows, factory open days, and any premises where third parties are present.

Employers Liability Risk

Manufacturing environments are inherently physical. Your workforce handles heavy components, operates power tools and machinery, performs welding and fabrication work, and may carry out on-site installation at height or in confined spaces. Employers liability insurance is a legal requirement under the Employers' Liability (Compulsory Insurance) Act 1969, and any lapse in cover can result in fines of up to £2,500 per day.

Beyond the legal minimum, claims from injured employees in manufacturing environments can be substantial, particularly where long-term health conditions such as vibration white finger, occupational deafness, or musculoskeletal disorders are involved.

Professional Indemnity Risk

Many lifting equipment manufacturers provide design services, engineering calculations, load assessments, and LOLER compliance support. If your advice or designs contribute to a failure — even where the actual manufacturing was carried out correctly — professional indemnity exposure exists.

This risk is elevated where you supply bespoke equipment to specification, provide written load ratings, or certify equipment for specific applications. A customer who suffers loss because your calculations or specifications were incorrect will have grounds for a professional negligence claim.

Property and Business Interruption Risk

Manufacturing facilities represent significant capital investment. Machine tools, fabrication equipment, stock, raw materials, and finished goods all need protecting against fire, flood, theft, and accidental damage. For bespoke manufacturers, partially completed orders represent a concentration of value that standard policies may not adequately cover without specific endorsements.

Business interruption cover is equally important. A fire that puts your factory offline for three months does not simply mean three months of lost production — it means lost contracts, damaged customer relationships, and the cost of sourcing alternative premises or subcontracting work.

Statutory Inspection and LOLER Compliance

The Lifting Operations and Lifting Equipment Regulations 1998 (LOLER) impose strict duties on those who own, operate, or control lifting equipment. While LOLER compliance is primarily an operational matter, manufacturers who also act as equipment operators — for example, where you test or demonstrate equipment at your own premises — must ensure your insurance arrangements reflect this dual role.

Key Insurance Covers for Lifting Equipment Manufacturers

1. Product Liability Insurance

Product liability insurance protects your business against claims arising from bodily injury or property damage caused by products you have manufactured, supplied, or repaired. For lifting and handling equipment manufacturers, this is non-negotiable.

Key policy considerations include:

• Limits of indemnity: Standard product liability limits of £1m or £2m may be inadequate for catastrophic lifting failures. Many manufacturers in this sector carry £5m or £10m limits. Your broker should advise on appropriate levels based on your product types, customer base, and geographic footprint.
• Products in the USA and Canada: North American markets carry significantly higher litigation risk. If you export to these territories, ensure your policy explicitly covers them — many standard policies exclude or sub-limit USA and Canada exposure.
• Product recall extension: If a defect is identified across a batch of products, you may need to fund a recall and replacement campaign. A product recall extension can provide cover for the costs of recall, customer notification, and disposal.
• Completed operations: For manufacturers who also install equipment, completed operations cover ensures that liability arising from installed equipment — after the contract has been completed — is covered under the same policy.

2. Public Liability Insurance

Public liability covers claims for bodily injury or property damage caused to third parties during the course of your business activities. For manufacturers with field engineering teams, this cover works in tandem with your product liability policy to ensure no gap in protection exists between on-site activities and the products you leave behind.

Ensure that high-risk activities such as work at height, hot works, and use of cranes or lifting equipment during installation are explicitly covered rather than subject to exclusions.

3. Employers Liability Insurance

A legal requirement in Great Britain for any business with employees, employers liability insurance must provide a minimum indemnity of £5m (though most insurers offer £10m as standard). Cover should encompass all employees, including temporary workers, apprentices, and labour-only subcontractors who work under your direction.

For manufacturers, particular attention should be paid to the accuracy of your policy schedule. Correctly declaring the nature of work — including on-site installation and servicing activities — is essential to avoid disputes at claim stage.

4. Professional Indemnity Insurance

If your business provides design services, engineering advice, load calculations, or compliance documentation as part of your offering, professional indemnity insurance is essential. Claims-made policies are the industry standard — meaning the policy in force at the time a claim is made responds, not the policy in force when the work was done.

This has important implications for manufacturers who cease offering design services: you should maintain run-off cover for a minimum of six years after your last design engagement, as negligence claims can arise long after the work is complete.

5. Commercial Property Insurance

Your manufacturing premises, plant and machinery, raw materials, work in progress, and finished stock should all be insured at full replacement cost. Under-insurance is a persistent problem in the manufacturing sector — particularly where the cost of specialist machine tools or fabrication equipment has risen significantly since the policy was last reviewed.

Key considerations include:

• Reinstatement versus indemnity basis for buildings
• Day-one uplift provisions to account for inflation during reinstatement
• Adequate cover for bespoke work in progress
• Cover for tools and equipment taken off-site by field engineers
• Computer and electronic equipment cover, including CNC and CAD/CAM systems

6. Business Interruption Insurance

Business interruption (BI) cover compensates for lost income and increased costs of working following an insured event such as fire, flood, or major plant breakdown. For lifting equipment manufacturers, setting the correct indemnity period is critical — reinstatement of a specialist manufacturing facility and replacement of custom machine tools can take 12 to 24 months, or longer.

Ensure your BI cover extends to include losses arising from damage at key suppliers or customers — supply chain business interruption is an often-overlooked exposure that can have a devastating impact if a critical component supplier suffers a major loss event.

7. Engineering Insurance and Plant Breakdown

Manufacturing businesses rely heavily on specialist plant — CNC machining centres, laser cutters, press brakes, welding equipment, and overhead cranes within the factory itself. Engineering breakdown insurance covers sudden and unforeseen mechanical or electrical breakdown of plant and machinery, including the cost of repairs and any consequential loss of production.

Statutory inspection services for plant and equipment — including your own factory cranes and hoists — can also be provided through an engineering insurer, combining compliance management with insurance protection.

8. Cyber Insurance

The manufacturing sector has seen a significant increase in cyber attacks in recent years, with ransomware attacks on operational technology (OT) systems causing production shutdowns at factories across the UK. For lifting equipment manufacturers who use connected CNC systems, CAD/CAM platforms, or cloud-based design tools, cyber insurance provides cover for:

• Ransomware and malware attacks
• Data breach response costs
• Business interruption caused by cyber incidents
• Cyber extortion demands
• Regulatory defence costs under UK GDPR and the Data Protection Act 2018

9. Commercial Vehicle Insurance

If your business operates a fleet of vehicles — whether company cars, vans for field engineers, or heavy goods vehicles for product delivery — appropriate commercial vehicle or fleet insurance is required. Fleet policies covering five or more vehicles typically offer cost efficiencies and streamlined administration compared to individual vehicle policies.

Where you transport oversized lifting equipment, ensure your policy covers abnormal loads and that appropriate road movement permits are obtained for wide or long loads.

Regulatory and Compliance Considerations

Lifting and handling equipment manufacturers operate within a demanding regulatory framework. Understanding this framework is important not only for compliance but for ensuring your insurance arrangements are structured appropriately.

Supply of Machinery (Safety) Regulations 2008

These regulations implement the EU Machinery Directive in UK law (retained post-Brexit) and impose obligations on manufacturers to ensure machinery is safe before it is placed on the market. Compliance includes risk assessment, technical file preparation, declaration of conformity, and UKCA marking (replacing CE marking for goods placed on the GB market).

Failure to comply with these regulations does not simply create regulatory risk — it can directly affect the validity of your product liability insurance. Insurers will expect you to demonstrate that your products meet applicable safety standards, and non-compliance may be cited in the event of a claim.

LOLER 1998

The Lifting Operations and Lifting Equipment Regulations 1998 require that lifting equipment used at work is strong and stable enough for its intended use, marked to indicate safe working loads, used safely, and subject to thorough examination and inspection by a competent person. As a manufacturer, you have obligations to provide adequate information on safe working loads, installation requirements, and maintenance schedules.

PUWER 1998

The Provision and Use of Work Equipment Regulations 1998 apply to work equipment used by your own workforce, including the plant and machinery within your factory. PUWER compliance supports your employers liability position and demonstrates good health and safety governance to insurers.

BS EN and ISO Standards

Compliance with relevant British and international standards — such as BS EN 13001 (crane design), BS EN 818 (chain slings), BS EN 1492 (textile slings), and ISO 4301 (crane classifications) — is expected by professional buyers and increasingly assessed by insurers during the underwriting process. Maintaining current certifications and quality management systems (ISO 9001) will support both your marketability and your insurance terms.

Common Claims Scenarios

Understanding the types of claims that occur in this sector helps illustrate why comprehensive cover is so important.

Structural Failure of a Custom Hoist

A manufacturer supplied a bespoke electric chain hoist for a food processing facility. Three years after installation, a manufacturing defect in the load chain caused it to fail under normal working loads. The dropped load injured two operatives and damaged costly processing equipment. The manufacturer faced product liability claims exceeding £750,000 and professional indemnity exposure relating to the original design specification.

Forklift Mast Collapse During Demonstration

During a live product demonstration at a customer's premises, a modified forklift mast collapsed due to a welding defect. A visiting manager sustained serious injuries. The public liability insurer responded to the immediate injury claim while the product liability insurer was engaged in respect of the defective manufacture. Adequate limits across both covers were essential to fully defend the claim.

Cyber Attack on a CAD/CAM System

A crane manufacturer's engineering network was hit by ransomware, encrypting design files for 27 active orders. The business was unable to manufacture for 11 days while systems were restored. Cyber insurance covered the forensic investigation, system restoration, and £180,000 in lost production costs.

How to Get the Right Insurance for Your Business

Lifting and handling equipment manufacturing is a specialist risk that requires a broker with genuine sector experience. Standard commercial combined policies from high-street providers are rarely adequate — they may exclude key activities, impose sub-limits on product liability, or fail to address the professional indemnity exposure inherent in design-led manufacturing.

When approaching the insurance market, be prepared to provide the following information:

• Full description of products manufactured, including materials, weight ratings, and applications
• Annual turnover and split between domestic and export sales
• Details of any design, engineering, or consultancy services provided
• List of countries to which products are exported
• Quality management and testing procedures, including any relevant certifications
• Details of any previous claims or incidents
• Information on your workforce, including number of employees, roles, and off-site activities
• Details of your premises, plant, and estimated reinstatement values

Working with a specialist commercial insurance broker ensures that your policy is structured to reflect your actual operations, that appropriate limits are in place, and that you are not exposed to gaps in cover that only become apparent when a claim arises.

Frequently Asked Questions

Is product liability insurance a legal requirement for lifting equipment manufacturers?

Product liability insurance is not legally mandated in the UK in the same way that employers liability insurance is. However, many professional buyers, contracts, and trade associations will require it as a condition of doing business. More importantly, the financial exposure from a product liability claim in this sector can be existential for an uninsured business — making it an essential protection regardless of legal requirement.

What level of product liability cover do I need?

The appropriate level depends on your product types, customer base, and geographic exposure. For manufacturers of heavy lifting equipment used in industrial settings, limits of £5m to £10m are common. If you export to the USA or Canada, your broker may recommend higher limits or specific arrangements to address the elevated litigation risk in those markets.

Do I need professional indemnity insurance if I only manufacture to customer specifications?

If you simply manufacture to a specification provided entirely by the customer and provide no design input, engineering advice, or certification, your PI exposure may be limited. However, in practice, most lifting equipment manufacturers provide some level of design review, load rating, or application advice — which creates PI exposure. Your broker can help you assess whether PI cover is warranted based on your actual activities.

Does my insurance cover equipment that I have previously sold and is still in use?

Yes — product liability insurance covers claims arising from products you have already sold, not just products you are currently manufacturing. This is why product liability is described as a "long-tail" risk: exposure continues for years after a product has been sold and can arise from equipment that is many years old.

What is LOLER and how does it affect my insurance?

LOLER (Lifting Operations and Lifting Equipment Regulations 1998) sets out duties for those who own, operate, or control lifting equipment. As a manufacturer, your primary obligation is to ensure your products meet the requirements for safe working loads, instructions, and marking. LOLER compliance demonstrates that you have met your statutory duties, which supports your position in the event of a product liability claim.

Can I get cover for export markets including the EU?

Yes. Most specialist product liability policies will cover sales throughout the EU and other international markets. USA and Canada typically require specific declaration and may attract higher premiums or sub-limits. Always disclose your full geographic footprint to your broker to ensure there are no territorial exclusions that could leave you exposed.

Is engineering breakdown cover the same as plant and machinery insurance?

Not exactly. Plant and machinery insurance (within a commercial property policy) typically covers damage caused by external events such as fire, flood, or theft. Engineering breakdown cover specifically addresses mechanical or electrical breakdown — sudden internal failure of the plant itself — which is usually excluded from standard property policies. For manufacturers who rely heavily on specialist CNC or fabrication equipment, engineering breakdown is a vital additional cover.

Conclusion

Manufacturing lifting and handling equipment is a rewarding but risk-intensive business. The products you build underpin critical operations across construction, logistics, manufacturing, ports, and beyond — and when they fail, the consequences can be severe. Protecting your business with the right combination of product liability, public liability, employers liability, professional indemnity, property, and business interruption cover is not simply good practice: it is the foundation on which a sustainable manufacturing business is built.

At Insure24, we work with lifting and handling equipment manufacturers to ensure their insurance programme reflects the true scope of their operations and provides genuine protection when it matters most. Our specialist team understands the regulatory landscape, the risks of design-and-build contracting, and the importance of adequate limits for a sector where a single claim can run into seven figures.

To discuss your insurance requirements or to obtain a competitive quotation, call us on 0330 127 2333 or visit www.insure24.co.uk to request a quote online.