Product Recall Insurance – You don’t hold the cover but should you?

Product recall is a worrying prospect for any producer(especially those using contract manufacturers outside the UK) of goods, threatening both financial loss and damage to a company’s brand and reputation.

Products catered for can range from food & beverages, nutraceuticals, medical devices through to consumer products and even automotive parts and everything in-between.

Cover is generally available for recall costs, rectification costs, business interruption / loss of sales, reputation protection as well as errors by contractor manufacturers. Cyber product tamper and software product safety can also be added by some insurers as well as ancillary costs.

How much does it cost?

Premiums can start from just £5,000 + IPT with excesses again at £5,000

Coverage Highlights

Malicious product tampering and extortion
As standard, policies provide cover for malicious tampering or alteration that gives rise to a product safety issue. Extortion demands are also covered.

Cyber product safety
Technology is an increasingly important part of the product design and manufacturing process. Cover can be included for recall events arising from safety critical errors made during the production, programming or coding of software elements.

Rectification cover
Policy covers both premise and product rectification costs, including cleaning and recalibrating of buildings and equipment, salaries, product replacement and redistribution. This is one of the most significant areas of cost when dealing with the aftermath of a product recall.

Business interruption cover
Cover for costs associated with responding to a recall event, and we also cover the loss of future sales whilst the product remains unavailable for sale. Typically cover can be arranged for 12 months.

Ancillary product recall costs
Any incident will incur a large variety of ancillary costs, such as those for an investigation, for storage, transport and labour and also for disposal and destruction of damaged goods.

Brand and reputation protection
Following a well-publicised recall event, it is essential to protect your company’s reputation. Insurers offer specialist crisis media management during and after the event, as well as advertising and promotional activity in the immediate aftermath.

Pre-incident crisis consultancy fund
A significant benefit of these policies are that they includes a fund to pay for expert independent crisis consultants who provide a range of useful services designed to avoid and mitigate product recall incidents. The fund can be used for establishing a crisis plan, public relations training or crisis simulation training, to name just a few options available.

Recall event liability endorsement
First party losses such as stock disposal and loss of sales can devastate a company’s finances. This endorsement ensures third party claims will be covered as well. Our preferred supplier will also pick up the legal bill.

Optional Extra Cover

  • Customer Business Interruption
  • Retailers’ Expenses
  • Religious Product Specification Guarantee
  • Recall Event Liability
  • Claims Preparation Costs
  • Customer Refusal
  • Cyber Product Tamper and Software Product Safety
  • Ancillary costs

Additional Reading

Defective Products Recall – Rowlands & Hames (
Proposal Form

For quotations, please speak to your existing Account Director or John Isles on 01253 598953 or

*Thanks to CFC Underwriting Limited

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Product Recall Insurance – You don’t hold the cover but should you?