Since today’s world is all about “real time information”, your inability to immediately and effectively respond when a crisis hits could mean a loss of reputation, employees and customers. When is the last time you put your current policies to the test? Has your insurance coverage kept pace with the growth of your business and with changing regulations? As a retailer or wholesaler, it is important to be aware of costly risks not covered by many property and casualty insurance policies that are typically sold within the food and beverage industry. It is time well-spent to routinely review your coverage and ensure your brand is protected.
Risk Exposure: Most Likely Gaps in Your Coverage
Legal Defense Coverage for C-Suite and Other High-Level Persons
In the past few years, the FDA has been criminally prosecuting corporate executives and high-level managers (Jensen Farms, others). The executives, faced with high legal fees to defend themselves, have not been able to get insurers to pay the defense costs because most insurance policies exclude covering defense costs for criminal acts. After studying this problem, Leavitt Group’s Food Safety Solutions team came to realize that legal defense costs can and should be insurable for food executives. This new coverage is in final review and will be available shortly.
Contaminated Product Insurance (Product Recall) Bought by Vendors
Although several insurers offer this type of policy, buyers need to know there are considerable differences in the insurance protection offered by different insurers. It is also important for you to understand the scope of insurance protection available to your company from contaminated product insurance (CPI) policies bought by your vendors in case they are the responsible party in a contaminated product event and you need them to pay the loss.
Leavitt Group’s risk analysis helps you identify exposures to potential loss scenarios and recommend improvements to your insurance protection by reviewing your policies. You may find it useful to extend this risk analysis to review coverage available to you through your vendors’ CPI policies.
Property Insurance Coverage Limitations
Many property insurance policies contain restrictive wording that can result in you not having adequate coverage when a loss occurs. Common coverage gaps include:
- Contingent business income loss resulting from supply chain disruption
- International supply chain loss resulting from customs detention and refusal to enter the country
- Exclusions, sub-limits, and high percentage deductibles
- Policies not correctly structured to cover various ownership interests
Private Labeling Advertising Liability
General liability and umbrella policies do not cover intellectual property, media, and false advertising or misrepresentation in advertising claims. When advertising leads to lawsuits from competitors and consumers, special insurance is needed to provide defense and indemnification.
We’ve Brought in the Industry’s Best to Help
Earlier this year, we partnered with the Leavitt Group, the seventh largest independently held insurance brokerage in the United States. We believe the Leavitt Group is the ideal partner to advise our customers due to its food supply chain expertise, nationwide footprint, and ability to work with and influence any underwriter as one of the country’s largest independent insurance advisory firms.
Use of ReposiTrak Will Likely Lower Your Premiums
Technical information collected by ReposiTrak can be used, with permission, to supplement loss control & safety information useful to insurance underwriters. Access to this information could effectively lower a user’s risk profile to qualify for lower insurance rates.
A Free, No Obligation Review of Your Current Policies
Any ReposiTrak customer can take advantage of Leavitt’s insurance advisory service to complete a thorough review and audit of risk exposures and insurance coverage. The Leavitt Group is happy to share their findings with you so that you can fill in your gaps and reduce your risk.