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The universe in 3D

Imagine being miles out at sea on an oil rig or even in space, and in urgent need of a spare part. Well, the solution to such problems may soon be that you just simply print one off.

However, such innovative technology brings a number of risk and liability challenges...

 

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Nasa has been testing 3D printing technology on the International Space Station.

It sounds like science fiction, but this is the likely shape of things to come. NASA has been testing 3D printing technology on the International Space Station as a first step towards establishing an on-demand machine shop in space.

Meanwhile, the US navy and shipping company Maersk are both separately looking to 3D printing to produce spare parts for vessels while at sea.

Growing application

3D printing is being hailed as a revolution in manufacturing, offering a faster, cheaper way of producing bespoke products. And its acceptance is accelerating. Wohler Associates believes that the 3D printing industry will grow to $10.8bn by 2021 from around $2.2bn in 2012.

The technology is now widely used, especially for creating prototypes and bespoke parts in industries like aviation, automotive and the medical sector. Components made by 3D printers already feature in jet airliners, race cars and rocket engines. 3D printers are also being used to make surgical implants andprosthetic limbs, while bio-printing can even create human tissue.

“3D printing is market-ready. It is now regularly used in the design and prototype phase, but over the next five to 10 years we will see the technology make its way into wider manufacturing and push further down into the value chain,” explains Michael Bruch, Head of Research & Development at AGCS.

A new dimension

As commercial 3D printing increasingly moves into mainstream manufacturing, organizations will have to address a number of evolving risks, most notably around product liability, intellectual property and data.

“The implications of 3D printing, as applied in industries like aviation or for developing prototypes, are manageable,” says Juergen Weichert, Liability Expert
at AGCS. “However, as the technology evolves and becomes a greater part of the supply chain, product liability could become more complex, while the increased reliance on data will be a new challenge for manufacturers,” he says.

Printing a new liability landscape

Should a product prove faulty, who is liable will depend on who is producing and selling the product. For example, if a company uses 3D printing to make prototypes, or even components for use in its own products, there will be little change, Weichert explains.

However, liability would be less clear where processes are split, such as where one company produces a component for use in another’s product, or where one firm provides the design, another the 3D manufacturing, and another the distribution.

Apportioning liability could become even more challenging as new business models emerge – for example, online platforms have been established for people to share designs that users can customize and then print. “Companies will need to understand the effect of customization of their products and who is responsible for that customization when it comes to liability,” Weichert says.


Testing times

In addition to who is liable, companies will also have to consider the implications of 3D printing for product quality control and traceability.

As companies start to use 3D printing in manufacturing there will be many questions around the testing of products. In aviation, each component must be checked to make sure it is fit for purpose. However, this will not be
common practice in most other sectors, Weichert explains.

“There are many potential grey areas, such as the subtle differences between prototypes and a mass produced product. However, no matter how a product or component is produced, it must be shown to be fit for purpose,” he says.

3D printing will enable manufacturers to produce personalized or customized products – which raises the question as to whether each individual product will
need to be tested.

“Will every part be considered bespoke or a mass product? These are just the kind of key questions that  will need to be answered when a company is seeking to purchase product liability insurance,” Weichert explains.

Insurance implications

Insurance policies most effected by the development of 3D printing will be product liability and product recall, although there are also implications for general liability, errors’ and omissions’, directors’ and officers’, workers’ compensation, as well as cyber insurance.

However, insurance products are already doing a good job of covering the existing use of 3D printing, according to Weichert. “From an insurer’s perspective, the legal framework is already in place to deal with product liability and recalls, and there are no real issues for underwriters when it comes to low volume production with sufficient quality control,” he notes.

However, insurers will have to keep an eye on how the materials used in 3D printing perform in the longterm. For example, products made on 3D printers use
new materials, new techniques, and are used in new applications, all of which are untested over time.

There could also be wider implications for business interruption insurance, both positive and negative. For example, 3D printing could play a positive role in addressing rising business interruption exposures, but it could also make it harder to trace products through the supply chain.

“The application of 3D printing could have important ramifications for the supply chain, although how this may pan out is still unclear,” says Bruch. “On the one hand, it could reduce an over-reliance on key suppliers and bring down the time and cost of providing replacement parts. On the other hand it could add complexity to some supply chains and make it harder to trace faults.”

Risk management review

While insurance coverage does not have to be an issue, companies will need to review risk management processes and show underwriters that they have addressed key issues, such as maintaining quality control, advises Weichert. The introduction of 3D printing in a well risk managed industry like the aerospace industry – where components are continually checked – is relatively straightforward. Even in other sectors, like the automotive industry, existing processes could easily be adapted to meet the challenges of 3D printing, Weichert says.

However, companies should review their processes and quality control as they expand the use of 3D printing. “It’s not really a question of insurance, but a question of showing that a product is fit for purpose,” says Weichert.

“It is important to challenge your own risk management and processes,” says Bruch. “Supply chain and product safety are part of day-to-day risk
management but you need to challenge them again and again,” he concludes.