Product recall insurance unlikely to reimburse Irish pig farmers
Lloyd’s insurance and reinsurance specialist, Miller, has warned that with regard to the health scare over pork produced in Ireland, insurance policies purchased to indemnify the costs of recalling consumer products may not pay out.
Kieron Russell, a member of the firm’s special risk team, explains that underwriters of product recall insurance typically include policy exclusions for contamination by carcinogens, such as the dioxin which has apparently entered animal feed used by up to ten pig farmers.
In addition, product recall insurance is frequently limited by a manifestation clause.
In this case, injury caused by the contamination would need to occur within a certain period, which Mr Russell estimates at 120 days for a typical policy, but dioxins are linked to certain cancers that could take years to develop.
So far, meat valued at around € 100 million has been withdrawn from supermarket shelves worldwide.
Tests have shown that some pork products contained up to 200 times more dioxins than food safety authorities allow, although dioxins are generally only regarded as a health risk to humans if exposure is very long term.
Investigations are continuing to determine whether the contaminated feed could also have been used for Irish beef cattle.
Category: Business Insurance News, Insurance News
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