What type of insurance should Alex purchase to cover potential claims against his toys?

Product liability insurance is specifically designed to protect manufacturers, distributors, and retailers from claims related to injuries or damages caused by their products. In the context of Alex, who is likely producing or selling toys, this type of insurance is essential. It covers legal costs and any payouts associated with claims if someone is harmed by one of the toys due to defects in design, manufacturing, or labeling.

For example, if one of Alex's toys malfunctions and causes injury to a child, product liability insurance would provide him with financial protection against the resulting lawsuits. This coverage is crucial for anyone in the business of selling or distributing products to ensure they can manage unexpected legal claims effectively.

Other types of insurance mentioned in the choices do not address the specific needs associated with product-related claims. For instance, workers' compensation insurance is intended for employee injuries that happen during work and is not relevant to customer claims concerning product safety. Public liability insurance typically covers general liabilities but may not include specific product defects. Employer liability insurance focuses on protecting businesses against employee-related claims rather than claims arising from the use of products. Thus, product liability insurance is the most appropriate coverage for Alex's situation.