Does your business manufacture, sell, or serve food products? If so, then your business is at risk for becoming the target of a food contamination or foodborne illness claim. Restaurants, bakeries, grocery stores, food processors, manufacturers, takeout businesses, grab and gos, food trucks, farms and farm stands- any of these businesses can be on the receiving end of a food contamination claim. After all, food contamination, even in the most carefully regulated spaces, is a fairly common issue.

There are a wide variety of potential contaminants. Between bacteria, viruses, chemicals (even from cleaning and sanitizing in an attempt to avoid contamination), and parasites, there are a myriad of sources that can lead to illnesses and outbreaks. Depending on the seriousness of the contamination, these can lead to hospitalization, and even death. That being said, it’s very important for businesses that handle food products of any kind to protect themselves from claims in the event of a contamination or outbreak of foodborne illness.

Food oriented businesses have their brand and reputation to consider as well. The impact that an outbreak or contamination event can have on a small local business, or a well-known national chain can be devastating. Take for example the effects on Chipotle, which most people can remember as having had issues in recent years. Chipotle had several instances of foodborne illness from E. coli in their meat products that originated in multiple locations. As a result, for quite some time, the chain suffered from a drop in confidence and damage to their brand name after issues with contamination. It’s important to keep in mind that while a business may take every step necessary to maintain a sanitary and safe food-handling environment, accidents do happen, and they can suffer the impacts of a contamination event that may be no fault of their own. Malicious tampering can happen, along with contaminations as a result of a third party supplier, error in food-handling procedures, even an ill employee. The costs associated with any of these events can be enormous- both from a financial and reputational perspective.

Fortunately, there is Foodborne Illness Coverage available. Foodborne Illness Coverage typically comes into play as a part of the general liability policy all business owners have. A complete policy with good coverage will include coverage that goes beyond just the standard liability issues, such as medical claims and other associated costs, but will include assistance with respect to the future losses of the business. Business interruption coverage should be included if your physical plant, farm stand, or restaurant needs to be closed down for a number of days due to the contamination. In addition, if there is a product recall associated with your food manufacturing business, you’ll need to get the product removed from shelves and back into warehouses or processing centers. Once that is done, you will also need to make certain it has been disposed of properly, which has significant costs associated with it.

An expert who is helping food-related business owners put together a well-designed policy should include coverage for things like voluntary recalls, foodborne illnesses, and reputational harm. Larger food-related businesses such as chain restaurants or businesses with multiple locations to cover should seek out additional coverage within their policies as any contamination issue becomes more complex when there are several locations and potential contamination sites to consider.

With all of these potential costs associated with a contamination event, it’s important for business owners to understand what the process may be like when they are in a position to make a claim. It may take some time from the point of actual contamination to the business owner being made aware that they are the source of a foodborne illness. More than one consumer may become sick, get in contact with a hospital or health department, and the process for tracing the illness back to a particular business, product or location may take time, during which additional contamination may continue to occur. It can take several days before a contamination is exposed and then days more before a claim is submitted.

The next step in the process is the investigation phase. Insurers will want to know the particulars and details associated with the situation. Did the Board of Health become involved? Was your location closed or forced to close as a result? There may be some time gaps in this process as well while information is relayed between the claims adjusters and insurance investigators as well as local officials from the Board of Health. While this is being investigated, the financial ramifications of the event may compound as well. It’s important to keep complete and accurate records at every step in the process, and to have detailed accounts regarding the financial effects of the event to present with your claim. What was the business’s revenue prior to the event? What was the revenue after? An accurate account of what was lost is vital when submitting a claim for processing. Business owners can expect several weeks of investigation, and submission of financial data. With some policies, there may be some immediate payouts to cover certain expenses, but policy-holders should expect the overall claims submission and reimbursement process to take time.

Much like any other kind of commercial or personal claim, there is a process of gathering data, submitting verification, negotiation, and work on the part of both parties, insured and insurer. Appropriate processing is a collaborative effort where data is very important, so keeping detailed records prior to any need for submitting a claim will ultimately be to your benefit in the future.

Having a complete policy that will protect your business from the legal ramifications of a foodborne illness contamination event is vital, but it’s also very important to make certain your business is protected from the financial impacts associated with reputational damage control. With a policy that includes business interruption protection for loss of revenue associated with consumers avoiding your establishment after an event becomes publicised, to the extra expenses associated with marketing campaign efforts to repair damages in credibility, costs associated with the removal and disposal of contaminated products, and any other remediation or mitigation efforts, the financial impacts go far beyond simply defending your business from a lawsuit.

True protection can include overtime costs for regular staff after an event, hiring of temporary staff to assist with mitigation or replace ill staff members, innoculations, vaccinations, and even testing. There are even additional benefits, like a crisis helpline, proactive email notifications, and crisis management teams. Taking advantage of all of the assistance available is a smart investment when we consider just how frequently contamination events can occur. In today’s social media world, foodborne illness events become publicized very quickly. It only takes a moment for someone to write up a negative review after a perceived food poisoning issue, and before you know it, your restaurant or food truck is in hot water. Best to take advantage of a complete protective policy, rather than be caught unawares.

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