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Coverage protects manufacturers from California product liability

Posted On: Oct. 8, 2015 12:00 AM CST

Wells Fargo Insurance Services USA Inc. said Thursday that they have launched an insurance program specifically designed to provide protection from California’s Proposition 65 law.

Proposition 65 “requires product manufacturers, distributors, and formulators to provide “clear and reasonable” warnings on products sold in California that contain chemicals known to be carcinogenic, or cause birth defects, if exposure to those chemicals from the product exceeds the safe harbor level. Currently, California Prop 65 covers more than 800 chemicals,” according to a Wells Fargo Insurance statement.

The liability insurance program provides financial protection to product manufacturers, distributors, and formulators of products that contain any of six plasticizers covered under California Proposition 65, Wells Fargo Insurance said in the statement.

According to Wells Fargo Insurance, the average settlement cost for these claims exceeds $80,000, and existing general liability, product, and pollution policies don’t provide coverage which leaves companies at risk if faced with a Proposition 65 lawsuit.

“We recognized a need existed with our customers and in the marketplace and we worked closely with SPI, The Trade Association of the Plastics Industry to craft the program,” Glynis Priester, Wells Fargo Insurance environmental national practice leader said in the statement.