Product Recall Insurance Debated in Wake of Egg Recall

In the wake of the recall of over half a billion eggs due to contamination by salmonella, economic losses are still being calculated; how much of those losses are insured is yet to be determined. And as incidents of food contamination rise in frequency and severity, insuring against losses incurred because of such events becomes more of a matter for consideration.

Product recall insurance has been steadily rising on business owners’ radar screens for the past few years, as recalls of everything from pet food to spinach to peanut butter and now eggs take a higher and higher toll – not just on the public, with deaths and hospitalizations, but also on businesses – business interruption, the cost of the recall itself, and the reputational damage to the company involved can amount to a devastating loss, depending on the incident.