Many businesses have products, supplies or even property elements prone to contamination. Whether you’re a retailer or a manufacturer, contamination is a serious expense. Before settling on business insurance, consider whether contamination insurance is right for you.
The Hidden Costs of Contamination
Contamination causes damage or loss of products. Therefore, it has many other expenses associated with it. Damage to food, beverages, pharmaceuticals or cosmetics, for example, can result in consumer harm. If they become sick or ill, the company might need to pay for their recovery.
Whether contamination reveals a simple error or illicit activity doesn’t lessen these expenses. Often, companies involved with contamination incidents incur high costs for damage control. Contamination hurts a brand’s reputation. Further media attention and client distrust might even cause financial returns to fall.
What Does Contamination Insurance Cover?
Contamination insurance covers the expenses associated with direct contamination damages. It can also cover resulting expenses in the aftermath. Many business owners even pair their contamination insurance policy with a product liability policy and recall insurance. Together, these policies create a more comprehensive level of protection.
Once a business handles the costs of contamination, these policies can help control the further spread of contamination—as well as its associated expenses.
A contamination insurance policy, itself, covers the following:
- Recall costs
- Media announcement costs
- Gross profit losses
- Overall product value
- Crisis response costs
- Extortion costs
Because contamination can hurt a business, these basic coverage options tend to be in most policies. Still, other costs exist. Recall consultants get involved. Third-party recall expenses can also be an issue. Between lost operations and ongoing legal costs, a contamination policy can cover many other factors.
Do You Need Contamination Insurance?
If your business handles any product that buyers consume or apply to their bodies, you may need contamination coverage. Breweries, food manufacturers, makeup manufacturers and pharmaceutical manufacturers are excellent examples of this.
Humans make errors, and simple mistakes in product management can result in major health risks. Across the United States, product recalls tend to be devastating. Even if your business has a good safety record, a simple processing error can result in ongoing problems.
We suggest making contamination insurance part of your policy. Take care of your brand’s reputation, and take care of your consumers, too. On every level, a safe, secure business must thrive to assure the health and happiness of its customers.
Contact the professionals at G & H Financial Insurance for assistance with your business insurance at 281-395-5497.