In an opinion piece in Food Safety News, two insurance company executives reassure food companies that a product recall doesn’t necessarily mean it is time to panic. They say that in recent years, the food industry has experienced a dramatic increase in recalls, withdrawals and contamination events. The U.S. Department of Agriculture’s Food Safety and Inspection Service (FSIS) requested or monitored almost 100 Class I recalls involving serious health hazards related to meat, poultry and egg products in 2015, a 130 percent increase from 2010. Class II recalls, involving less serious risks of health hazards, rose by about 70 percent during that period. The trend continues this year. Through August, the FSIS reports 51 food safety and inspection recalls and alerts, which reflects more than a 120 percent increase from the same period in 2015.
The authors outline several factors that may be contributing to the rise, but say that regardless of the reason, food companies should take a proactive stance by protecting themselves against the recall risk, rather than being reactive and responding in a panic. They say an important tool in every food company’s arsenal to help alleviate the economic and reputational consequences of a contamination or recall event is Product Contamination Insurance (PCI), which may provide coverage for: (1) accidental contamination; (2) malicious product tampering; (3) governmental recall; and (4) product extortion. The article goes on to explain losses that are potentially covered, as well as how to maximize coverage and avoid possible “time traps.” READ MORE