Growers can take pre-emptive action, said Michael Lieberman, an insurance broker at Capitol Risk Concepts Ltd., White Plains, N.Y.
“From an insurance perspective, the criminal charges brought against the Jensens have not directly impacted the insurance market in a negative way as liability policies do not respond to criminal acts,” Lieberman said.
However, Lieberman said the charges should be a reminder to grower-shippers to make sure their insurance is adequate. He said the insurance landscape has changed in recent years as more food-related outbreaks have been detected.
“In my mind the big issue is the availability of coverage,” Lieberman said. “Insurers, particularly on the product liability side, are pulling away from food exposures. On the flip side, the contamination/recall insurance marketplace remains quite competitive as insurers compete for market share.”
Lieberman said he is seeing fresh produce companies meet challenges related to food safety with a head-on approach. He said companies are accounting for higher risk management costs and working with food safety experts to reduce risks.
“Due to the incredibly selective nature of liability coverage underwriters and the ease in which they can walk away from food-related businesses, produce companies need to be working closely with their insurance agents or brokers.”
Lieberman said produce companies that share all of their food safety programs and protocols with their insurance brokers will likely get better deals from underwriters because the brokers can explain what the grower-shipper is doing to reduce food safety exposure.
Tips on taking charge of your insurance coverage
Insurance brokers and attorneys familiar with the fresh produce industry offered growers and shippers these suggestions to help them actively manage their insurance coverage:
• Don’t blindly renew, review coverage and make changes when necessary.
• Negotiate for the specific coverage you need. Walk away from one-size-fits-all pitches.
• Ask about trigger events and exclusions.
• Make sure if you have some say in what attorney represents you if there is legal action.
• Tell your broker or agent everything about your food safety program.