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Needles in strawberries highlight rising recall risks

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The discovery of needles inside strawberries has highlighted increasing food recall risks facing producers and other parts of the supply chain, Swiss Re Corporate Solutions says.

Singapore-based Senior Casualty Underwriter Manzhi Zheng says the demand for recall cover has been rising in the past few years and the strawberries incident has generated further interest.

Food Standards Australia and New Zealand lists 68 consumer recalls so far this year, surpassing the total of 50 for all of last year. The figure excludes the strawberries contamination, which had a trade-level recall.

Swiss Re Corporate Solutions says there have also been 11 recalls to date in Singapore compared to typical annual levels of 3-4, reflecting the wider trend.

Recalls are rising due to increased scrutiny of complex supply chains, while fatalities from contaminated products are declining in developed markets, the insurer’s Casualty Specialist Asia Pacific Jim Amberson told insuranceNEWS.com.au.

He says many companies have product liability insurance for injury, death and property damage but fewer have contaminated products policies, which include first and third-party cover for incidents such as the strawberries tampering.

“One of the things this incident has really pointed out is that even if you have a well-managed company with all the accreditations and quality control standards, you can still be hit with a pretty major financial loss because of something that affects your industry.”

The strawberries case has also highlights risks where participants in an industry segment are affected by an incident even if they are not directly involved in a recall.

“We are working with groups, including in Australia, to design solutions to see if there are ways to address that,” Mr Amberson said.