Selena Kearvell
Managing Director; UK Food and Beverage Industry Practice Leader
Product recall is a risk for many businesses. And while the product or the reason behind the recall may differ, the consequences for a company or investor can be similar. For instance, food and beverage manufacturers, distributors and retailers are at risk of accidental contamination, product extortion, government mandated recalls and malicious product tampering. As well as contaminated products, there is also a danger of items being mislabelled due to human error or faulty machinery.
Mislabelling is one of the key causes of a recall. This can lead to significant financial damage and reputational harm. Some businesses may find it difficult to recover from these impacts.
According to a recent report, allergen labelling errors were the common cause of food and drink recalls in the UK between January and June 2025.1
These types of risks can also expose gaps in traditional insurance protection, particularly when considering the broader financial impact of recall events such as lost sales, logistics costs and brand damage.
In practice, recalls might be initiated by retailers where they identify a potential safety issue with a product they stock. This may be driven by the retailer’s risk appetite and brand protection priorities, and may not always align with the manufacturer’s preferred timing or assessment. In these cases, retailers and manufacturers typically work together, along with regulatory bodies where appropriate, to manage the recall process.
When a product recall happens, preparation matters
That’s why we’ve launched a new maturity assessment for risk managers to help businesses assess their readiness, spot areas to strengthen, and build a clearer picture of how prepared they are. The new maturity assessment tool can reveal gaps across three critical dimensions:
- Governance and planning
- Preparedness and testing
- Understanding impact
The assessment score is just the starting point, our specialists will then work with you to close any critical gaps, from support with scenario planning to reviewing current coverage and extensions purchased.
Having the right protection in place is key
Fast-moving consumer goods companies face numerous risks such as contamination, extortion, government-mandated recalls, and negative publicity that can threaten reputation and financial stability. Even minor breaches of product integrity can lead to significant, and potentially long-lasting, consequences for businesses that serve the public.
Product contamination remains a critical exposure across all stages of the supply chain, posing a threat to companies involved in manufacturing, distributing, and retailing mass-produced goods. Protecting against these risks is key to safeguarding brand reputation and wider business resiliency. Historically, some SME’s have not purchased dedicated product recall cover, hoping to rely on product liability policies or retaining the risk themselves. However, uptake has been increasing as regulatory scrutiny, retailer requirements and recall costs have grown.
To address the needs of our clients, Marsh has developed the RecallPro facility, a specialised contaminated product insurance (CPI) solution provided by a leading London specialist insurer designed to help clients recover quickly and effectively from contamination incidents.
For companies involved in mass-produced food, beverages, cosmetics, pet food, and other topical or ingestible products with annual sales up to GBP 200 million, RecallPro provides rapid quotes and coverage to protect your business from contamination risks.
Enhanced coverage features tailored to your needs
RecallPro offers a broad spectrum of competitive coverage enhancements designed to meet the unique demands of the product recall market. Depending on underwriting and policy terms, benefits include:
- Expanded trigger language providing broader protection in specific scenarios.
- Greater flexibility with extended indemnity and reporting periods.
- Industry-specific sub-limits and extensions aligned with your operational risks.
- Flexible structuring of limits, deductibles, and endorsements to fit your risk profile and budget.
- Coverage for operational disruptions and reputational damage, safeguarding your business beyond direct product losses.
- Optional extensions addressing evolving supply chain complexities and regulatory challenges.
The latest addition to RecallPro is the ability to significantly broaden coverage utilising the Quality Defect endorsement which covers a wide range of impairments including the appearance, finish, fitness to perform, efficiency or durability of a product. This endorsement is aimed at responding to events listed below but not resulting in bodily injury which is a requirement under most other CPI policies;
- has a defect in its taste, smell or appearance;
- does not meet a religious standard;
- is intended to be vegan but contains ingredients harvested or manufactured from animal origin;
- is intended to be vegetarian but contains ingredients harvested or manufactured from animal origin which means it is no longer vegetarian;
- has pesticide contamination;
- is rancid;
- has fungal contamination; or
- has a pest infestation.
Get in touch
If you’d like to discuss product recall insurance, contact your Marsh Commercial representative or get in touch with Selena Kearvell our UK Food and Beverage Industry Practice Leader selena.kearvell@marsh.com or email BMProductRecall@Marsh.com.
Source:
1. foodmanufacture.co.uk/allergen-errors-most-common-cause-of-uk-food-recalls-report-finds
Real-world insight that we don't share anywhere else
Get access to exclusive help, advice and support, delivered straight to your inbox.
