Ever eye a bowl of potato salad or plate of chicken that’s been sitting in the sun for hours and wonder if it’s still okay to eat?
It seems as if every three to four months we hear about another food-borne illness outbreak. Two of the most recent outbreaks both involve salmonella: one in cantaloupes and one in mangoes. According to the Center for Disease Control (CDC), there are over 76 million Food-Borne Illness cases reported in the US each year. Of these cases, there are hundreds of thousands of hospitalizations and thousands of deaths that occur. The CDC states that there are over 200 known diseases that are transmitted through food which cause symptoms ranging from mild gastroenteritis to life threatening hepatic, neurological and renal syndromes.
While the majority of these cases remain local concerns and are quickly remedied, certain more serious occurrences, whether true or alleged, cause disastrous financial ramifications to food suppliers, franchised restaurants or restaurant chains. The negative publicity surrounding an outbreak of food-borne illness taints the trade name and can cause a significant loss of revenue to the business. According to PEW Charitable Trust the annual cost related to Food Borne Illness is roughly $152 billion or roughly $2,000 per case. What this number does not take into account is the lost revenue that results from such occurrences. Studies have shown that revenues drop from 60% – 80% once the news of an outbreak occurs and can take over six month to reach the pre-outbreak revenue levels.
Surprisingly, many corporate treasurers, controllers, and risk managers are not aware that general liability or property insurance policies do not include the coverages necessary for business interruption or loss of income resulting from food borne illness incidents. To some companies this remains an uninsured risk, knowingly or not.
To learn more about how food-borne illness can impact your company financially and possible ways to mitigate or transfer this risk, please do not hesitate to contact our Managing Principal Albert Sica at 732.395.4251 or at [email protected].
