What Manufacturing Insurance Does NOT Cover

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Understanding common exclusions and gaps in manufacturing insurance policies

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Manufacturing insurance policies have exclusions – knowing them avoids costly surprises

WHY EXCLUSIONS MATTER IN MANUFACTURING INSURANCE

Manufacturing insurance provides essential protection, but no policy covers every risk. Exclusions define what is not insured and are particularly important for manufacturers with complex processes, machinery, products and regulatory exposure. Understanding these exclusions allows you to structure the right combination of cover.

Common Exclusions in Manufacturing Insurance Policies

These exclusions commonly apply unless specialist cover is arranged.


  • Wear, tear and gradual deterioration of machinery
  • Faulty workmanship or poor quality control
  • Known defects or pre-existing damage
  • Deliberate acts or gross negligence
  • Contractual penalties or liquidated damages
  • Uninsured cyber incidents under standard policies

Exclusions Specific to Manufacturing Risks

Higher-risk manufacturing activities often require specialist extensions.


  • Product recalls unless specifically insured
  • Pollution and environmental contamination
  • Gradual exposure claims without employers’ liability
  • Overseas product liability without export cover
  • Machinery breakdown without dedicated breakdown insurance
  • Business interruption without insured physical damage

How Manufacturers Can Avoid Coverage Gaps


  • Declare processes, materials and products accurately
  • Add machinery breakdown where plant failure is critical
  • Arrange product recall and contamination cover if needed
  • Include cyber insurance for digital production systems
  • Consider environmental liability for waste or chemicals
  • Review exclusions annually as operations change

FREQUENTLY ASKED QUESTIONS

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Do all manufacturing insurance policies have exclusions?

Yes. All insurance policies include exclusions that define what is not covered. These vary depending on the type of policy and the manufacturing activity involved.

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Is pollution usually excluded?

Yes. Pollution and contamination are usually excluded from standard liability policies and require specialist environmental liability insurance.

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Does business interruption cover all downtime?

No. Business interruption usually requires insured physical damage unless extensions such as cyber BI are specifically added.

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Are product recalls automatically covered?

No. Product recall costs are typically excluded unless a dedicated product recall or contamination policy is in place.

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Can Insure24 review exclusions before I buy?

Yes. Insure24 helps manufacturers understand exclusions, identify gaps and structure cover that aligns with operational risk.

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