From vehicles to mobile phones to nut butter, product recalls have the potential to seriously affect businesses’ bottom lines, but many organizations don’t realize the need for product recall insurance, according to Florian Beerli, senior vice president at Chubb.
“There’s a lack of education and understanding of what the coverage does cover,” Beerli said in a recent interview with Advisen. Some manufacturers may feel they have coverage for costs related to recalling and replacing products along with financial loss through their product liability coverage. This common mistake leaves businesses open to increased risk, according to Beerli.
“They underestimate the cost,” he said. “A recall can put a company out of business. It becomes a risk management tool.”
Read more at http://www.advisenltd.com/2017/04/10/product-recalls-can-be-costly-but-many-businesses-do-not-buy-coverage/
Erin Ayers, Product recalls can be costly, but many businesses do not buy coverage (April 10, 2017), available with subscription at Advisen Professional Front Page News.
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