“Plastic pieces are the most difficult to detect”

Mars announced recently that they are recalling millions of chocolate bars in 55 countries after small pieces of plastic were found. Christof Bentele, Head of Global Crisis Management at Allianz Global Corporate & Specialty (ACGS), explains why food recalls are on the rise and what the scale of the recall actually means.

 

Are foreign objects a common cause of food recalls?
 

Christof Bentele: Yes, indeed. Plastic pieces, in particular, are the most difficult to detect in comparison to other materials, such as metals, which are easily flagged with metal detectors. In most cases, contamination is caused by a very small piece of production machinery failing and breaking; other sources may include objects used in the cleaning process or fragments which have fallen into the production line simply by accident. Regardless, no matter how small the piece or contaminant, reputable companies want to ensure consumer safety and existing food safety regulations enforce such action.  
 

Often millions of products are recalled, even though only a very small number are actually poisoned.
 

Bentele: Given today’s mass production, a widespread recall does not mean that all products are contaminated, but rather, a mass recall reflects a highly concentrated production source, with high output levels. As such, the most prudent approach for a manufacturer to take is to recall any product which could potentially have been affected during a production run, or that has been created by a faulty machine.

 Christof Bentele, Head of Global Crisis Management at Allianz Global Corporate & Specialty (ACGS) : “The impact of a food contamination can be devastating for the company”
Christof Bentele, Head of Global Crisis Management at Allianz Global Corporate & Specialty (ACGS) : “The impact of a food contamination can be devastating for the company”  

How often do food product recalls happen?
 

Bentele: We have recently seen an increasing number of product recalls of food & beverage products, with both increasing geographical reach and financial gravity. This is driven by growing supply chains, tightening consumer safety regulations and also the faster dissemination of information around the globe. The impact of a food contamination can be devastating for the company, as food & beverage is generally regarded as an ‘emotional’ product with a strong brand recognition. If something goes wrong, the impact can significantly damage a brand and a company’s overall reputation. However, if a recall following a product contamination incident is professionally managed, it can help to minimize reputational damage and, in a best case scenario, even build consumer confidence and trust.
 

How can insurance support affected companies?
 

Bentele: Contaminated products insurance provides cover for recall costs, loss of gross profits and rehabilitation costs following either accidental or malicious contamination (whether actual or threatened), governmental recall and adverse publicity implying a product were contaminated when in reality is wasn’t.
 

Our policies also provide crisis management assistance. We have a partnership with red24 which provides immediate support globally and on a 24/7 basis in the event that a client experiences a product related issue. A team of over 85 worldwide specialists will advise and support the technical, legal/regulatory and communications considerations of a product recall.
Contaminated food: A product recall can help to minimize the reputational damage.
Contaminated food: A product recall can help to minimize the reputational damage.  

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