London-based Ironshore Pembroke Managing Agency has launched a product contamination recall insurance cover that focuses on risk exposure within the food and beverage industries.
The latest Ironshore product provides insurance protection for incident response expenses associated with product withdrawal, communication and rehabilitation costs on a first and third party basis.
Business interruption coverage for gross income loss is available for a period of up to 12 months from the actionable event. Additional coverage for reimbursement of expenses can be obtained for government recall demand and adverse publicity exposure.
Coverage can be underwritten at pricing minimums of US$10,000 per US$1 million of coverage, with policy limits available of up to $15 million.
“Our policy indemnifies for rehabilitation costs and loss of income to protect client cash flow and resolve satisfactory product reinstatement in the wholesale and consumer marketplace,” said Adam Parsons, divisional director of product recall.
The company developed the new product in response to the increasing volume of consumption product recalls, which average 25 to 30 incidents per week globally.
Contamination and subsequent recall occurrences can be triggered by accidental human error, malicious product tampering and product extortion throughout the manufacturing and distribution processes.
“With due diligence and corporate governance in place, companies within the food and beverage industries cannot completely remove the risk of human error, product tampering or other influencing factors that activate a product recall,” Parsons said.