Food Product Liability Insurance
Food product liability insurance is a new way to protect food companies from lawsuits. In the case of Dairy Farms, food products have a tendency to spoil. There are many critical points of food safety from the live farm animal to food products in the supermarket. Whether it’s slaughtering of animals, milking, feeding, cleaning, transporting, packaging, etc., there are many steps where food can spoil or become contaminated. Some common food born bacteria are e. coli, salmonella, mad cow disease, and listeria. These bacteria may be present in healthy animals in small amounts. But when the food is not kept refrigerated or processed correctly and hygienically, the food products can become toxic and harmful, even to the point of death, for anyone who consumes the food.
But spoiled food products are not the only source of lawsuits. People have food allergies and food labeling has become a very important portion of the food product. The food labels alone will deter some people from purchasing the product, while leading others to repeatedly purchase those products. Whether someone needs gluten-free food products, peanut free products, shellfish free products, etc., these affect one’s health. Not only can the food company be sued for improper labeling or mislabeling, the organizations using those food products can be liable for lawsuits as well.
Food product liability insurance is not a lawyer or some force field that is going to prevent lawsuits from occurring. If the food company or farm made a mistake which caused harm and damages to a customer, they can be sued and be held liable. But food product liability insurance will pay for the lawsuit, allowing the offender to come to a settlement out of court.
No one will argue that the most important priority would be to focus on safe food practices. But machines can break down or become inaccurate, people make mistakes, and there are many things that cannot be foreseen nor controlled. This is when food product liability insurance kicks in and acts as a safety net. A food company or farm needs to do a good job of food safety and labeling and all that they can do, but they should not be sued out of business due to one mistake. Think of this insurance as an automobile liability insurance. Although the most important thing is that everyone drives safely and cautiously, accidents can occur. They can occur due to many different reasons and this can cause you to be at fault for an accident where property is damaged or a person is injured, perhaps even killed. The automobile liability insurance would cover the victim’s damages and injuries. The United States requires that all drivers have at least a liability insurance policy on the vehicle they are operating. It’s possible that we’ll see some states, and perhaps even the federal government, begin to require that all farms and food companies carry some level of food product liability insurance. It makes business sense to carry insurance to protect the business, and it wouldn’t necessarily cause the food industry to become less careful.