Product contamination and recall exposures are a growing source of concern among businesses and the general public. There have recently been several high-profile cases of food contamination that affected the general public. \u00a0From the salad, to the entree and dessert, every course of dinner has been impacted.<\/p>\n
These incidents have been, in some cases, tragic. Multi-generation businesses have disappeared and people have died.<\/p>\n
At Wilson, Washburn, & Forster Insurance we have one client going through an incident right now. We\u2019ll call this client ABC Sausage. ABC Sausage processes, packs and distributes a variety of gourmet sausage products throughout Florida. (That is not our client\u2019s name and they don\u2019t make sausage, but in the interest of confidentiality it works for our purposes).<\/p>\n
ABC\u2019s most popular line – mild Italian sausage – was found at Publix by a random state inspection to contain listeria. Publix notified ABC who responded swiftly. Because of the way they track production and label their products, ABC knew the production run that was contaminated and to which customers it was delivered. ABC sent their own trucks out to all of their customers to pull that product.<\/p>\n
ABC sent samples of all of their products for independent testing, shut down production as well as did a full inspection and cleaning of their facility. Fortunately, no additional traces of contaminants were found.<\/p>\n
Publix, in an abundance of caution, went through their stores and disposed of all of ABC\u2019s products\u2014not just the mild Italian sausage where the state found listeria\u2014but also the sweet and spicy Italian sausage, the applewood smoked chicken sausage, the breakfast sausage, the precooked frozen sausage, the packaged ground sausage meat, you name it!<\/p>\n
Fortunately, in this case, the issue was caught earlier and no one was hurt. \u00a0Additionally, ABC carries a production contamination and recall insurance policy that will cover all of the exposures listed above.<\/p>\n
ABC\u2019s policy covers:<\/p>\n
Product contamination policies have very broad coverage triggers. ABC\u2019s policy would have responded even if the recall had involved a competitor\u2019s products. In other words, if Publix had disposed of all of the sausage in their stores, that would have been a covered peril.<\/p>\n
What would happen if your company found yourself in a similar situation? If someone gets sick eating your product, that would be covered by the standard commercial general liability policy. \u00a0The recall of the product, the product itself, lost revenues, customers\u2019 lost profits, and the damage to your company\u2019s reputation are all exposures that would not be covered by the general liability policy. \u00a0A product contamination and recall policy fills important coverage gaps that can help your company survive a crisis.<\/p>\n