Warranties

Definition - What does Warranties mean?

Warranties are statements of assurance from a company that its products will perform as stated and that all codes and regulations were followed during its manufacturing. Warranties are relevant for product liability insurance. A company can void its warranty and have its claim denied if it fails to live up to the assurances given in the warranty.

Insuranceopedia explains Warranties

Problems can arise in product liability insurance if a company does not live up to its warranty. For example, a product liability insurance policy for a steel beam manufacturer may only cover products that were made in accordance with the warranty. If the warranty states that all steel beams produced by the manufacturer will weigh at least 200 pounds, the insurer may not reimburse a claim that was filed in relation to a 150 pound beam.

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