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Contaminated Products/Product Recall Insurance

Product contamination and ultimately product recall are becoming prevalent risks for many industries.  Companies involved in the commerce chain, including processors, distributors and retailers, can be affected by a product contamination or recall.  Whether a first-party or a third-party participant, the effects of a recall can be both lengthy and expensive.

This site has been created as your single source for the most current and comprehensive information on product contamination and recall, including available insurance coverages, trends and developments, recall scenarios and much more.  Please check back to our site as often as possible as we continue to update the tools and resources so they are of most value to you.

CP2 / CP3 Back To Top
  • CP2 

    In the event of an accidental contamination, malicious product tampering (MPT) or product extortion, coverage is provided for recall expenses, business interruption costs, rehabilitation expenses and consultant and advisor costs. 

    We utilize best-in-class, industry-recognized expert consultancies, such as NSF International and Edelman, to assist in quality audits, product safety education and crisis response.

    We provide improved coverage certainty through many policy definition clarifications. 

    We have an expanded scope of coverage through fewer policy exclusions.  

    Limits are available of up to $50 million for MPT and $10 million for Accidental Contamination. 
  • CP3 

    First product of its kind to offer the following additional coverage options on a menu basis:   
    Product Refusal protects against the refusal of an insured product during a scheduled delivery because of a report to the public of it to cause bodily injury and because of bodily injury that has been caused by a similar product 
    Third Party Recall covers any product recall liability of an insured product when consumption or use of the product will result or has resulted in bodily injury or property damage within 365 days 
    Intentionally Impaired Ingredients covers the contamination or impairment of an insured product which occurs due to an ingredient supplied to the insured where such contamination or impairment was intentional and wrongful, but not malicious (coverage may be available by endorsement to a MPT policy)

    Target classes include fruit, vegetables, ingredient suppliers, dairies, bakeries, beverages, supermarkets (except meat packing), distilled spirits, beer and wine, confectionaries and snack foods.
 
Recall Response® Back To Top

First-party expenses are covered including the cost of notifying customers of a recall, shipping and disposing of the recalled product, extra warehousing expenses and the costs associated with the refunding, repair or replacement and shipment of a new product back to the customer. 

Coverage is also provided for third-party compensatory damages including the cost of repair of the third-party’s product, business interruption caused by the product recall, damage to the brand reputation of the third-party and defense costs incurred as the result of any claims made from the product recall. 

Target classes include ingredient manufacturers and suppliers, food and beverage manufacturers and distributors, seafood processors, pharmaceuticals (over the counter and contract manufacturers), packaging product manufacturers, flavors and fragrance, meat processors, chemicals (food and cosmetic grade), medical devices and educational toys. 

Limits of up to $10 million are available.

RecallResponse® Overview (.pdf)
RecallResponse® Scenarios (.pdf)
Product Recall/Product Contamination Glossary (.pdf)

Claims Back To Top

WorldSource provides comprehensive global solutions to meet the property, casualty and specialty risk needs of U.S. and Canadian-based companies operating overseas and foreign-based companies operating in the U.S. and Canada.  
 
WorldSource offers insureds specialized support for a variety of claims including domestic and foreign primary casualty, domestic and foreign property, product recall, trade credit, kidnap and ransom/extortion and political risk with claims offices in New York, Dallas, Dubai, Istanbul, San Juan, Croydon and Manchester.

Drawing on the extensive experience of our claims professionals, their in-depth knowledge of local laws and regulations and an established and proven network of accounting, litigation and loss control experts, we are able to effectively and efficiently manage specialized claims around the world, immediately report covered claims in-country and issue claim payments in the country and currency that works best for our clients.

We utilize IntelliRisk® Advanced, a web-based claims analysis and inquiry system, providing forecasting, allocation, communication, reporting and querying tools for companies of all types and sizes worldwide.  Data reporting can be tailored specifically to a multinational client’s needs, with reports able to be generated in multiple currencies and custom layouts.

Insureds can report a claim by doing any of the following:

Fax:      
212-509-9369  
 
Mail:      
WorldSource Claim Department 
80 Pine Street, 11th Floor 
New York, NY 10005

Consultants Back To Top

As part of our commitment to providing our clients with unparalleled value-added service, we have formed strategic partnerships with three best-in-class consultants to aid in the handling and mitigating of product contamination and recall risks. 

Clayton Consultants is a unique security consultancy delivering corporate and private crisis management consulting services to multiple clients across the globe.  With experienced consultants strategically located throughout the world, Clayton can assist clients in investigating malicious product tampering and product extortion incidents as soon as they occur.  Clayton works with clients to identify security vulnerabilities, provide security training and assist in the establishment of effective incident-management protocols.  In the event of a crisis, Clayton's consultants are committed to delivering effective 24-hour response services.

Edelman, one of the world’s largest independent public relations firm with substantial expertise in product contamination and recall issues to assist clients through an immediate crisis and protect their long-term reputation.  Edelman’s product contamination communications specialists provide clients with the best possible strategy during the first 24-hours of a crisis, when a company’s reputation can be enhanced or irreparably damaged.  Having handled crises of all sizes from some of the largest product recalls in USDA history to smaller-sized national and international durable goods product issues, Edelman is prepared for all situations.  Depending on the insurance coverage engaged, Edelman can function as a full partner or in a short-term consultant.  If desired, additional Edelman services such as issues contingency planning and mock crisis simulations can be contracted separately.  Edelman's services include incident rapid response, management consulting, planning, escalation point identification and response, materials development, media relations and monitoring, and spokesperson training.

NSF-Cook & Thurber (NSF) is a market leading third-party food safety and quality auditing and consulting company that specializes in customized audits of process systems, sanitation, good manufacturing practices and facility biosafety programs.  During an accidental  contamination, product recall or malicious product tampering situation, NSF can provide WorldSource Crisis Management clients with food and safety consulting services such as customer complaint management, expert witness services, food safety program review/development and laboratory analysis immediately after a notice of loss.