Food Liability Insurance
Starting a new business is a complex undertaking, but it can also be rewarding. The long
hours and hard work might pay off with a successful company. After putting in time and effort, it makes sense to
protect the company and its image. For a company that manufactures food products, food liability insurance
is an absolute necessity.
This insurance should be in place from the company’s inception. It can protect a fledgling
company in the event of claims of damage or injury resulting from consumers eating their products. In some
instances, retailers will not even carry the products until they have purchased sufficient liability
Food Liability Insurance - A Specialized Coverage
Food liability insurance is a highly specialized form of coverage that is not
typically offered by ordinary insurance agents. Chances are that the food product manufacturer will have to do some
research to find an insurer that is willing to draw up a policy for them. These are not standardized,
one-size-fits-all policies. Rather, the agent or company that provides such coverage will utilize a number of
different factors in order to create a liability policy that makes sense for the food manufacturer. This may
involve answering questions related to the company’s annual sales, prior claims, the type of product, and the type
of market in which the company does business. Knowing such valuable information allows the insurer to draw up a
policy that will offer meaningful protection to the insured.
Because there are few commonly accepted standards where this type of insurance is
concerned, it is probably a good idea to request quotes from at least two or three different insurers, if possible.
Rates and coverages can vary widely, and the business owner may have to take considerable time to determine which
policy offers the best combination of price and coverage.
Food Liability Insurance - Why Do You Need It?
New food manufacturers may be tempted to think that liability insurance is just
another expense, one which they would prefer to avoid. However, the cost of not having such protection is generally
much greater than any premiums paid. In the event of a lawsuit, the company will find that the damage to their
bottom line is far less when they are insured.
Food liability insurance is an excellent means to protect the reputation and
success of a food manufacturer, while also taking responsibility for their practices. It is a necessary
precautionary measure that may never be used, but will nonetheless provide peace of mind.