Contaminated Products Insurance

What is Contaminated Products Insurance?

AIG’s contaminated products insurance offers clients the extensive coverage they need if and when product contamination and recall occurs. In the event contamination or a recall occurs, key expense areas are covered. Clients also receive the guidance and expertise of AIG’s strategic partner, NSF International — a market-leading, third-party food safety and quality auditing and consulting company — to help guide clients from the critical first few weeks through to the conclusion of a product recall.

Target classes of business include:

• Food and beverage manufacturers
• Bakeries
• Confectionary products
• Breweries
• Frozen foods
• Seafood
• Dairy products

Why does your business need Contaminated Products Insurance?

A few common examples:

• A snack food manufacturer employee mislabels a batch of cookies as not containing nuts so the company must recall the batch incurring recall expenses and the loss of income.
• A fish and food processor must recall chili sauce following a botulism scare and will spend the following six months inspecting and improving the factory before resuming distribution.

What Does Contaminated Products Insurance Cover?

Contaminated product insurance covers the business interruption costs, recall expenses, rehabilitation expenses, consultant and advisor costs and extortion costs for the following covered events:

• Accidental Contamination
• Malicious Product Tampering (MPT)
• Product Extortion 

Additional coverage options:

• Product Refusal: protects against the refusal of an insured product during a scheduled delivery because of a report to the public of it to cause bodily injury and because of bodily injury that has been caused by a similar product.
• Third Party Recall: covers any product recall liability of an insured product when consumption or use of the product will result or has resulted in bodily injury or property damage within 365 days.
• Intentionally Impaired Ingredients: covers the contamination or impairment of an insured product which occurs due to an ingredient supplied to the insured where such contamination or impairment was intentional and wrongful, but not malicious. This coverage option may be available by endorsement to a MPT policy. 

AIG capacity and limits:

• Capacity up to $25M in accidental contamination coverage and up to $50M in malicious product Tampering/extortion coverage
• Minimum deductible of $25K
• Minimum premium of $15K