Benjamin & Benjamin

The Lighting Council of Australia has asked Benjamin & Benjamin Insurance Group to help set up a member wide insurance program for Product Recall Insurance.

 

Why Product Recall insurance will suit you for the following reasons:

1. Product Recall insurance protects a business like yours from the financial impact of recalling your product due to defects or contamination, covering costs like replacement, refunds, and repair, as well as reputational damage and business interruption.

2. What Product Recall Insurance Covers:

   • ​First-party expenses: These are costs incurred directly by the insured company to conduct the recall, such as:

     • Communication to customers and the public (media announcements, etc.) 

     • Shipping, warehousing, and storage of recalled products 

     • Disposal costs 

     • Extra personnel costs for the recall 

   • Third-party expenses: Some policies may cover costs incurred by third parties due to the recall, but this is often limited.

3. Just in case you wanted to know the difference between Product Recall & Public Liability insurance: Product Recall insurance focuses on the financial impact of a recall, whereas Product Liability insurance focuses on the legal liability for property damage or injury caused by a defective product.​

4. Just in case you wanted to know the difference between Product Recall insurance & Warranty insurance: While both Warranty insurance and product recall insurance aim to protect businesses from financial loss, Warranty insurance covers the cost of repairs or replacements of a product, whereas, Product Recall insurance is designed to protect your business’ brand because it covers the financial cost to you/your business for recall of a defective or unsafe product from consumers or distributors and associated public relations costs to maintain your brand.

5. ​Product Recall insurance policies are defined as an occurrence-based insurance policies. This means that you need to have a policy in place when the claim occurred, which may be a different/later date to when a claim is made against your business… this can be years later. So, you might instal some lights in 2020, and two years later (2022) the product fails, but the failure is not found until 2023 ….. You need to have had Product Recall insurance in place in 2022, not 2023 – 2022 is when the occurrence of the claim actually occurred.