Even with farm bill provisions, recall insurance still long shot

07/05/2012 11:23:00 AM
Mike Hornick

In the end, the calculation on insurance costs of any kind can be a matter of common sense, as Nelson sees it.

“You weigh the value of the company against the cost of the insurance,” he said. “If you make $100,000 in salary a year and someone says your auto insurance is a couple thousand dollars, that’s not bad. But $25,000 is ridiculous. It’s the same thing in business. On the liability side, I don’t know if Jensen Farms could have bought enough insurance. Liability there will be in the tens of millions.”

It’s fairly rare for a food safety event to affect hundreds or thousands of growers and shippers, as the Colorado listeria outbreak did with cantaloupe, Nelson said.

“Maybe your efforts should be more focused on the prevention side,” he added.


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Charlie    
California  |  July, 07, 2012 at 08:02 PM

I hope that Greg Nelson was quoted out of context when he said that, "Maybe your efforts should be more focused on the prevention side." As printed, it shows that he clearly does not understand the recall insurance conundrum that this article addresses, that is, that a recall by single firm can leave non-implicated firms to suffer the economic burdens of scared consumers. Also, what does he think that the industry is doing, ignoring food safety controls? Is he totally out of touch with the industry? WGA should have him take a course on speaking to the media.

ExpertRECALL    
Indianapolis, IN  |  July, 09, 2012 at 01:50 PM

While recall insurance is widely available as this article states, many companies are still unaware of the many options and benefits to recall insurance. Coverage can include product recall expenses and liability to third parties seeking damages. Additional options are detailed on the following page: http://www.expertrecall.com/recall-services/product-recalls/what-should-your-recall-insurance-cover/

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