A product recall can happen at any time when you manufacturer and/or provide a product to consumers. The risk of a product recall goes well beyond the bounds of visible hard dollar costs. Have you experienced a product recall before? What do you think some of the hidden risks would be?
To help here are a few ideas:
- what is the long term affect of this product recall and how many customers will you loose because of it?
- what is the new acquisition cost going to be after the product recall is announced?
- what is your plan NOW to re-establish your image to the consumer and community?
- do you have the capable staff to handle the product recall process effectively and efficiently?
- how much time is being re-routed from productive work to the product recall process?
- how has your employee engagement been affected by this?
- how long will it take you to get back on track to full efficiency after the product recall has ended?
- how well equipped is your organization to withstand lawsuits and potential judgement if no insurance is available?
- who is your legal counsel on retainer and do they specialize in this type of situation?
You see not every insurance policy provides coverage for product recall. In fact, most do not. It may be time to review this risk and become pro-active in dealing with it.
For reference purposes below is a link to an article with greater detail on this risk.
5 reasons to purchase product recall insurance- PropertyCasualty 360