Between recalls, product labeling lawsuits, and food contamination outbreaks, the food industry has found itself increasingly in the spotlight, making the need for specialized food industry insurance paramount.
- First, the industry has become an increasingly complex and global enterprise, with vertically integrated supply chains, multinational import and export channels, and a growing network of growers, packagers, distributors, processors, and retail sellers. Quality control under those conditions can be a risk management nightmare. After all, it only takes one weak link in the chain or one disastrous event in the network to put everyone at risk.
- Second, consumers and their advocacy groups have been increasingly vocal about food quality and labeling issues. They want more options and solutions, and this is driving big changes in the way products are processed and marketed. It’s also driving a booming business for law firms that are hungry for the same type of multimillion dollar settlements they won against the tobacco industry. And if they can succeed against industry giants like General Mills and Heinz, smaller players will likely become even more vulnerable.
- And third, the federal government is increasingly cracking down on food safety and labeling issues. The Centers for Disease Control (CDC) has become more effective at detecting food borne illnesses and linking them to a source company, and the Food and Drug Administration (FDA) was given greater inspection, enforcement, and recall authority under the Food Safety Modernization Act (FSMA) of January 2011.
What does this mean for your business?
It means that no matter what role you play in the global food network, you’re increasingly vulnerable to the fallout from product contamination recalls, food labeling liability suits, and costly litigation – all things that can jeopardize your bottom line and your company image – even destroy your business.
Consider just a few scenarios that could put you at risk:
- Supply chain disruption
- Equipment breakdown
- Spoilage and contamination
- Data breach / Internet disruption
- Criminal tampering of the food supply
It’s clear the stakes are higher than ever. So in addition to effective risk management and crisis management strategies, you need to be protected by specialized food industry insurance for your specific risks. Some of your options include:
- Product recall liability insurance
- Contaminated products insurance
- Business interruption insurance
- Cyber-liability insurance
Now more than ever, you need comprehensive protection. And, when it comes to your business insurance coverage, you can always rely on Heffernan Insurance to protect your interests. We have a team of experts who specialize in business insurance for food manufacturers, growers, packers, and distributors. So while you may not be able to control every link in the food chain, you can be prepared for most situations.