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Insurance lessons from the strawberry crisis

November 13, 2018

The recent strawberry crisis has highlighted a number of insurance implications food producers need to be aware of, a Gallagher specialist has said.

With news that a 50-year-old woman has been arrested in connection with the crisis which saw needles placed in strawberries and other fruit around the country in a series of copycat events, Stephen Elms, National Head of Food Production at Gallagher, said the food production industry can look to insurance cover to help protect their business.

strawberry blog imageElms noted that the full implications as it relates to insurance are still to be seen, but producers can look to particular areas of insurance to make sure they are fully covered.

“For the food production sector, product recall cover is of paramount importance and would respond if products have been tampered with and need to be withdrawn or recalled off shelves, “Elms said.

It is also important that producers and their brokers continually review their liability limits to ensure there would be sufficient coverage in place in the event of a loss.”

The sabotage of fruit threatened hundreds of millions of dollars’ worth of crops and saw the Federal Government increase penalties for food tampering with a 15-year jail term now the maximum punishment.

According to the Sydney Morning Herald, throughout the crisis there were 186 total complaints made about needles in primary containment as Crime Stoppers received 61 calls about alleged sabotage.

Elms said that there are other lessons that growers can learn from the contamination crisis.

“The strawberry crisis also highlighted the need to have a good handle on the supply chain and the risks associated with that,” Elms continued.

“A food producer should look to work with their broker to better understand their supply chain, find where the gaps are in their cover and work out how they would respond to such an incident in future.”

This subject is explored in greater detail in the latest Gallagher Market Overview Report, Reflecting on a year of change. The report is available as a digital download.

Download 2018: Reflecting on a Year of Change here