Product Liability Insurance for Vapes & Batteries

Product Liability

Misuse, lack of instructions and warnings, awareness, and education, are all factors behind the injuries caused by exploding batteries. When batteries come into contact with conductive materials such as loose change or keys, they will short, causing an explosion. If you sell batteries or any other vape (e-cigarette) products, this places you in the chain of commerce. According to the Strict Liability Law, as a seller you are liable for the products which you sell, even if you did not manufacture them. A good example of this is, if you buy a defective product from a major retailer which injures you. You are entitled to sue the retailer, distributor, importer, and manufacturer (if located in the United States/Canada), If the manufacturer is located in China you will not be able to successfully sue or subrogate against them. This leaves the liability to you and all the American companies involved in the chain of commerce.

Having vape product liability insurance can greatly assist you and your vape company in mitigating or settling the expenses related to the injuries. Exploding batteries are the most common and cause the greatest amount of injury. The injuries consists of minor to severe burns and/or disfigurements. The injured party is generally treated at a specialty burn center. The average hospital bill is $300,000. This means that a plaintiff is likely to receive one to two times the hospital bills as compensation for pain and suffering. The compensation can vary significantly from California to Texas to New York or other states. The larger problem is a jury trial. The jury is often very sympathetic toward the victims. The plaintiffs attorneys commonly introduce expert witnesses who will repeatedly state that the vape products are not FDA approved. This leaves the defense as a two legged stool. The jury sees the defendant as a flavored nicotine company selling defective devices.

What can be done to Mitigate Claims?

Injuries will happen regardless of warnings and instructions. Vape consumers find interesting ways to injure themselves. A man in the UK inserted a pen-style pen in his “arse”. The device exploded causing severe injuries. His argument was that “they make the devices too thin!”

Here are some steps you can take in your business to reduce (not eliminate) injuries and lawsuits:

1. Buy batteries which have a clear and visible warnings not to put batteries in purse or pocket.

2. Have a battery warning info-graphic posted in your store and in multiple locations throughout the store.

3. Sell or give away plastic battery carry cases with a warning which states something like: “Keep the battery in the case and never store without a case. As doing so will cause fire, injury, or burns.”

4. Educate your staff. Have your staff educate your clients.

5. Add a warning to your receipt. Don’t be afraid of using a statement like: DANGER: avoid serious injury or burns. Don’t store batteries in pocket or purse without a plastic case.

6. Share battery safety tips on social media – a great way to show your clients that you care.

Calco Commercial Insurance has developed no cost suggested warnings, instructions, and a infographic which you can use for your vape business. Contact us for more information.

Why are the Efest Batteries Excluded from Coverage?

Despite hundreds of injuries, Efest remained silent and continued to sell their 18650 batteries without the proper warnings. Every insurer which insurers the vape industry has an exclusion for Efest batteries. The exclusion is a result of the inability by global insurers to subrogate against them. When insurers are not able to subrogate against the liable party, no other choice remain but to exclude them. An insurer will use an endorsement form titled Specific Entities Exclusion and add Efest to that list. Note that there are other batteries brands which are excluded and Efest is not being singled out here.

Who needs Vape Product Liability Insurance?

All parties in the chain of commerce need Vape Product Liability Insurance:

1. Vape Shop Insurance

2. Vape Importer Insurance

3. Vape Distributor Insurance

4. E-liquid Manufacturers Insurance

5. Brand Owners of E-cigarettes and Vape Product Insurance

Contact us at (877) 678-0201 or complete on online vape insurance quote request.