Swiss Re:

• “Publication finds that the number of recalls per year in the US has almost doubled since 2002
• Food contamination costs US health authorities USD 15.6 billion per year; nearly 9 million Americans became sick from contaminated food in 2013 alone
• Half of all food recalls cost the affected companies more than USD 10 million – highlighting the value of risk transfer through insurance
• A globalised food supply chain is making risk management for food recalls more difficult

Food manufacturers operate in a vast, globalised supply chain, where one mislabelled product or contaminated ingredient can cause sickness, death, multi-million dollar losses and massive reputational damage for the affected companies. Swiss Re’s Food Safety in a Globalised World examines how the increasing number food recalls is impacting consumers public health services, governments and companies globally. The report describes how risk mitigation and risk transfer through insurance can protect food manufacturers operating in a highly globalised, often fragmented, supply chain. Swiss Re’s analysis of publically available food recall data in the US shows that since 2002, the number of food recalls have nearly doubled. The increase has been influenced by regulatory changes and an increasingly globalised food supply chain… A single food recall can lead to severe financial loss and reputational damage for food producers. 52% of all food recalls cost the affected US companies more than USD 10 million each and losses of more than USD 100 million are possible. This figure excludes the reputational damage that may take a company years to recover from. The public sector is also heavily affected by contaminated food. According to the US Department of Agriculture, costs for the US public health system from hospitalised patients and lost wages in 2013 alone was USD 15.6 billion. In total 8.9 million people fell ill from the 15 pathogens tracked, with over 50,000 hospitalised and 2377 fatalities.”