Product Contamination Insurance Prompted by Food Recalls

A new policy being launched by XL Insurance (Bermuda) Ltd goes beyond standard policies by offering coverage for government recalls.

Recent U.S. food safety recalls involving eggs and peanuts and the belief Congress will enact a tougher food safety law have prompted XL Insurance (Bermuda) Ltd (XLIB) to offer a new Product Contamination policy. XLIB will host a seminar today at its offices in Hamilton, Bermuda about current regulatory and food safety issues in North America and will present the new policy to brokers and their clients.

XLIB and Lloyds' said this is the first policy to offer broad-form coverage for recalls in North America that result from adulterated or contaminated ingredients. "The exposures of food and drink companies have been increasing with the growth in the global supply chain and the more proactive approach of regulators in recent years," Ed Mitchell, Global Product Recall Manager for XL Insurance, said in a Lloyds' news release. "The more that food and drink companies source their ingredients from around the world, the more prevalent the supply chain risk becomes."

Last year's recall involving salmonella in peanuts killed nine people and cost firms affected by it more than $1 billion, according to the release, which says FDA recalls rose from 283 in 2008 to 557 in 2009 because of that recall.

XLIB Chief Casualty Underwriter Beth Piggott said the new policy is being launched at a critical time. "The last few years have seen a significant rise in the frequency of recalls in North America combined with a noticeable increase in the size and scope of the recalls and a corresponding increase in financial severity. These recalls are under growing scrutiny from regulators," she added. "The August 18th recall of 380 million eggs in the U.S. is a typical example of this trend. In addition to the proactive stance taken by the U.S. Food and Drug Administration, we also think it likely that the proposed Food Safety Enhancement Act could pass into law in the relatively near future. This would give regulators authority to mandate recalls and will put food and beverage companies into unchartered waters in terms of the food safety environment in which they are operating. XLIB has been writing Product Contamination business for over 10 years, and we have used this experience to re-engineer our policy to provide broad and contemporary cover to respond to today's challenging regulatory environment and the growing capacity needs of companies seeking higher limits."

The policy will provide coverage for:

  • Accidental contamination
  • Malicious contamination
  • Product extortion
  • Forced and/or government recall
  • Adverse publicity
  • Priority 24/7 crisis management

XL Insurance is part of XL Group plc.

Product Showcase

  • HAZ LO HEADLAMPS

    With alkaline or rechargeable options, these safety rated, Class 1, Div. 1 Headlamps provide long runtime with both spot and flood options in the same light. Work safely and avoid trip hazards with flexible hands-free lighting from Streamlight. Read More

  • Matrix's OmniPro Vision AI Collision Avoidance System

    OmniPro Vision AI is a state-of-the-art collision avoidance system that features NIOSH award-winning Visual Artificial Intelligence (AI) technology. This highly accurate, powerful system identifies and alerts on pedestrians, vehicles and specified objects, ensuring safer facilities, mining operations and industrial sites. With its web-based cloud application, OmniPro Vision AI also logs and analyzes a wide range of data related to zone breach notifications. Operating without needing personal wearable devices or tags, OmniPro has visual and audible zone breach alerts for both operators and pedestrians. Read More

  • Full Line of Defense Against Combustible Dust Nilfisk

    Nilfisk provides a comprehensive range of industrial vacuums meticulously crafted to adhere to NFPA 652 housekeeping standards, essential for gathering combustible dust in Class I, Group D, and Class II, Groups E, F & G environments or non-classified settings. Our pneumatic vacuums are meticulously engineered to fulfill safety criteria for deployment in hazardous surroundings. Leveraging advanced filtration technology, Nilfisk ensures the secure capture of combustible materials scattered throughout your facility, ranging from fuels, solvents, and metal dust to flour, sugar, and pharmaceutical powders. Read More

Featured

Webinars