In our previous post, we discussed the fact that auto exposures and workers’ compensation claims account for the majority of produce distributor and wholesaler risks. However, as a dynamic industry, the professionals in this sector face a variety of other perils. As such, a proper Michigan Produce Distributor Insurance Program is required to mitigate risk and financial responsibility in the event of a claim. With that said, let us take a closer look at some other common exposures that produce distributors face.

Products liability.

Transporting goods naturally subjects this industry to spoilage risks. It’s critical that you monitor the quality of the products transported and keep an accurate log detailing the inventory.

In addition, any recalls should be handled immediately. As poor quality products can cause financial and reputational damage, these should be addressed with urgency. In fact, the average cost of a food recall can exceed $10 million for the food companies- which doesn’t include brand management or loss of sales. Naturally, the distributors of these products would also see a huge financial loss in the event of a recall, so ensure your team inspects and monitors inventory carefully. If a product is compromised, it’s wise to discard it all together than risk it.

Inland marine exposures.

These risks cover the equipment and products being transported. If the transporting vehicle is in a collision, or if the cooling equipment fails, the products are susceptible to spoilage. As the entire load would likely become contaminated, very little of the product could be salvaged. What’s more, this coverage extends to necessary equipment that the distributors often transport. For example, forklifts, trucks, and other contract equipment used to move and store products are covered under this policy if the transporting vehicle is owned by the distributor.

Lastly, proper safety and handling practices need to be implemented inside the storage facility in order to prevent contamination from the insecticides and pesticides used to preserve the products.

At Capital Insurance Group, we understand the unique risks that produce distributors and wholesalers face. We have expertly crafted a policy to safeguard all of the potential risks your industry may face. For more information about our products and effective risk management strategies, contact us today at (888) 296-0418.