Product Recall Insurance is designed to respond to specified recall events rather than every problem involving a product.

The exclusions and insured triggers vary significantly between insurers.

What may not be covered? #

Depending on the policy, cover can be restricted or excluded for matters such as:

• Known product defects or circumstances existing before the policy began.
• Deliberate or dishonest conduct.
• Failure to comply with specified quality control requirements.
• Ordinary deterioration or shelf-life issues.
• Products that simply do not meet expected quality standards where no insured trigger applies.
• Contractual penalties.
• Fines or penalties.
• Unapproved recall costs.
• Certain regulatory actions.
• Cyber-related events unless specifically included.

This is not a complete list.

Is every defective product recall insured? #

No.

A product being defective does not automatically mean the policy will respond.

The defect generally needs to fall within an insured event defined by the policy.

For example, some policies focus on contamination, bodily injury risk or malicious tampering, while broader policies can also address certain product withdrawal events.

Are quality problems covered? #

Not necessarily.

A product that is safe but has the wrong:

• Colour.
• Taste.
• Size.
• Packaging.
• Appearance.
• Specification.

may not fall within a traditional contaminated product policy.

Some broader Product Recall products can offer additional Product Withdrawal cover for specified manufacturing or quality issues.

What if the business knew about the problem before taking out insurance? #

Known circumstances should not be assumed to be covered by a new policy.

Product Recall Insurance should be arranged before a recall issue arises rather than after a problem has already been identified.