Product Recall Insurance

Product Recall Insurance

Comprehensive, low-cost product recall insurance for retailers and online sellers

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What is product recall insurance?

Product recall insurance is a form of liability insurance that helps businesses cover the costs associated with recalling a defective or potentially dangerous product from the market.

A product recall can affect any consumer product – from electronics to food – due to safety concerns, contamination, or design defects.

Product recall insurance typically covers customer notifications, shipping, and disposal expenses. It helps protect a company from financial losses and reputational damage due to a product recall event.

Product recall insurance is often included in product liability insurance. It typically covers the cost of the following recall actions:

 

  • Customer and regulatory notification fees
  • Shipping and disposal
  • Replacement of defective or recalled products

The cost of product recall insurance varies on the type and volume of products you sell, manufacture, or distribute. 

Insurers consider the following factors when determining the cost of a premium:

  • Your location
  • Type of products
  • Product sales volume 
  • Insurance claims history
  • The coverage limits you choose
  • Annual and projected revenue

Product recalls can be incredibly costly to manage and can damage a company’s reputation. 

A broad range of industries and small businesses should have product recall insurance protection, including:

  • Retailers
  • Online sellers (Amazon, Etsy, eBay, Shopify)
  • Food and beverage manufacturers
  • Electronics manufacturers and sellers
  • Automotive manufacturers and retailers
  • Consumer goods and toys manufacturers and sellers
  • Pharmaceutical and medical device manufacturers

Getting insured is quick and easy!

Complete our 5-minute online application for a free product recall insurance quote.

Product Recall Claims Examples

Coverage

Problem: A manufacturer of automotive airbags recalls of thousands of vehicles due to defective airbags that could explode.

Outcome
: Product recall insurance may cover the cost of customer communications and product replacements.

Coverage

Problem: A retailer discovers they’ve been selling a brand of smartphones with lithium-ion batteries that overheat. The manufacturer orders a recall of the batteries.

Outcome: Product recall insurance may cover the cost to notify customers, and dispose of and replace the faulty batteries.

Coverage

Problem: A customer reports they found metal fragments in a frozen meal. The food manufacturer voluntarily issues a recall. 

Outcome: Product recall insurance may cover the cost of disposing and replacing the recalled products.

Frequently asked questions

What triggers a product recall?

A product recall can be voluntarily issued by a manufacturer or distributor of a packaged product (including food) or ordered by a government agency.

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Ready to start? Let’s get a quote!

Get the comprehensive, low-cost product recall insurance your business needs quickly and easily through Zensurance.

More than 350,000 Canadian small businesses trust Zensurance to provide them with customized commercial insurance that protects their finances and reputations.

Complete our online application for a free quote in five minutes or less.