6 Insurance Policies For A Metalworking Manufacturing Business

Metalworking, which dates back to prehistoric times, began with shaping soft metals like gold and has since advanced into a sophisticated industry that includes techniques such as hammering, smelting, forging, and welding. Metalworking helps support nearly every facet of our lives, from essential tools and appliances to construction projects like buildings and bridges to the production of vehicles, ships, and aircraft.

In the article below, Rachel Pinsonneault—commercial staff underwriter at Central Insurance—outlines the essential insurance policies every metalworking manufacturing company should have and explains why industry-specific expertise makes all the difference when picking a carrier.

Metalworking Risks and the Protection of Workers’ Compensation

“Metalworking comes with a wide variety of exposures,” Pinsonneault says. “We’re talking about high-temperature items, dangerous fluids, heavy and sharp machinery, and the ever-present risk of occupational injuries.”

With 9,314 businesses in the metalworking industry in the U.S., there’s a lot of potential for an accident or injury to happen. Naturally, Workers’ Compensation insurance tops the list of coverage must-haves—it’s often required and critical to protect both employees and employers in this industry and beyond.

Digging Deeper: Workers’ Compensation insurance protects your employees in the event of a work-related injury or illness. Based on your state’s regulations, it can cover medical expenses, rehabilitation services, and a portion of lost wages if the employee is unable to work.

Pinsonneault emphasizes that taking proactive measures with loss control can help mitigate risks to employees. Common precautions metalworking companies can take to protect their employees include:

• Ensure you’re meeting OSHA guidelines
• Provide mandatory forklift certification for operators
• Use PPE provided by the employer (not brought from home)
• Establish safety protocols for working around hazardous machinery
• Have a designated safety manager on staff to lead regular safety audits

“All it takes is one overlooked safety guard or one improperly used forklift to result in a serious injury,” Pinsonneault warns. “And those incidents don’t just hurt the employee—they affect morale, compliance, and your bottom line.”

Learn more: What Insurance Do I Need for My Steel Products Manufacturing Facility?

Additional Insurance Policies Your Metalworking Business Needs

Workers’ Comp is far from the only coverage that metalworking manufacturers need. You must also think beyond the shop floor. 

For example, what happens if a part you produce causes damage when installed in a $2 million machine? That’s where product liability insurance becomes vital.

“Even if a company is just making a component to someone else’s specifications, they still carry responsibility if something goes wrong,” Pinsonneault says. “You can’t assume that passing the blame down the line will protect you.”

Pinsonneault notes that if your company offers design or engineering services, you should consider professional liability coverage as well. This coverage protects against errors or omissions in design specs that could lead to costly project delays or damage.

For metalworking operations, a comprehensive insurance portfolio should also include:

• Commercial Property Insurance—most metal manufacturers operate with significant capital investment in facilities, equipment, and inventory. Commercial property coverage safeguards these assets from fire, theft, and natural disasters. Pinsonneault emphasizes the importance of evaluating coverage limits annually and ensuring your buildings, stock, and computers are appropriately valued because a surprise shortfall after a claim is the last thing you want.
• Business Income Coverage— in the event of a property loss, business operations could be shut down. This loss of time can be a hard hit for manufacturers, which is why business income coverage is important. It covers net income that would have been earned during normal operations, including wages for key employees.

• Equipment Breakdown Coverage—metal manufacturers rely on complex, often custom machinery, to create their products. The breakdown of this equipment can be detrimental to the business. “Something like a power surge or motor burnout isn’t covered under regular property coverage,” Pinsonneault explains. “This presents a significant risk for manufacturers”. This is where equipment breakdown coverage comes in. It can help cover the cost of repairs, replacements, and downtime for covered breakdown losses. Additionally, she explains that “having backup systems or redundant processes can help minimize downtime and reduce the overall impact of a breakdown.”
• Cyber Liability Insurance—while it may seem unrelated to metalworking, cyber-attacks are a growing threat, especially for companies processing large transactions or managing sensitive customer data. “Manufacturers often deal with valuable data and are just as likely to be targeted as any other industry,” Pinsonneault explains. That’s why, even for manufacturing organizations, “cyber insurance is no longer optional.”

Manufacturing Specialization is the Key to Great Coverage

Working with an insurance provider who understands your metalworking manufacturing business makes a big difference when it comes to all-encompassing protection.

When your carrier has a background and hands-on experience in the field, they are better equipped to provide the type of service you expect—from underwriting to claims to risk mitigation. 

Pinsonneault emphasizes the value of collaborating with independent agents like those partnered with Central. Central is incredibly selective in our agency partnerships, as we only look to work with groups that similarly specialize in the fields in which they write business. 

Excellence is Central’s Policy

These four words encompass the most fundamental of Central’s core values as a company, honoring the trust you place in us each day. That’s why we’ve developed tailored solutions in metalworking manufacturing insurance to ensure your business thrives. Contact your local independent Central agent for more details about manufacturing insurance or to get started with a quote.