Product Recall Insurance
Product recall programmes are by definition sudden, unscheduled events for any organisation. The direct cost of conducting a recall, replacing the affected product and handling associated litigation is generally thought to be an expensive process. Undoubtedly liability challenges exist for many organisations in relation to the manufacture, sale, and distribution of their products.
When an event happens giving rise to a recall issue, clients often revert to crisis mode given the sensitivities surrounded by the situation, however with the implementation of good contingency planning, normally this means the process is already in place and can respond almost immediately.
Historic events have proven time after time that a product recall event can devastate company's brand and profitability to the extent where a company is either no longer able to trade or the costs involved in rectifying a product recall can have a financial implication for many years after.
No matter what size, industry, location, or reputation a company has it can be left in ruins if their product recall exposure is not well managed.
Critical questions you should consider when evaluating your risk:
- Have you experienced any product recalls in the last five years or had any situations occur which could have lead to a major recall?
- Has any recall been caused by: a purposeful contamination, an accidental contamination, a tooling issue, a raw material issue, or some other issue?
- Has a recall every occurred in a business which has recently acquired?
- What processes or mechanisms are currently in place to identify a reportable issue?
- Are all your potential risks covered by your product recall insurance?
- Does your existing insurance arrangements cover catastrophic loss? If so, are all the potential risks you are exposed to, covered under the policy?
- Are you currently on top of recent legislative changes in all of the markets which you operate/distribute in?
To discuss your requirements further please speak to one of the team on 01604 630003.
