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‘Insure or risk losing millions in a product recall’

08 March 2016

Food manufacturers should ensure they are protected against product recalls, otherwise they could risk losing millions, a leading insurer has warned.

The recent Mars recall illustrates how even a company with extensive product checks could suffer by mischance. 

The confectionery giant was forced to withdraw its products from 50 countries after a consumer in Germany found pieces of plastic in a Mars bar. 

“With a company of its size, you can bet your bottom dollar that Mars has extensive product-checking procedures in place so this just goes to show that a recall can happen to any company,” said Garry Moseley, a director within Arthur J. Gallagher’s specialist Food and Drink Practice.

“These types of recalls, particularly when you’re talking about an international issue, can lead to a myriad of issues from communicating the recall to consumers and sellers across a range of different countries in different languages, to managing the media response and the logistics of getting the products themselves out of circulation.

“There may also be legal costs involved should any harm come to consumers, which can be covered under product liability insurance.

“It just goes to show how vital it is that companies are properly protected with both well-tested crisis response plans and comprehensive insurance policies in place to cover costs.”


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