The new LPWE coverage is offered by endorsement as an enhancement to the Chartis' General Liability policies. Through this endorsement, policyholders are reimbursed for costs incurred that are due to withdrawal or recall of a product, including the following expenses:
- Transportation and storage costs
- Fees for temporary staff responsible for managing the product withdrawal process
- Overtime costs paid to the insured’s regular, “non-salaried” employees
- Expenses incurred during the proper disposal of the product
Chartis has also developed a Product Loss Control/Claims Defense Program (PLCDP) that can provide valuable assistance to clients in managing product liability exposures. Specifically, PLCDP can aid in:
- Identifying potential sources of exposures to product liability claims
- Employing “best practice” management controls to evaluate an insured’s PLCDP
- Maximizing management’s evaluation and implementation of key PLCDP elements to improve the risk assessment process
“The likelihood of a mandated or voluntary product withdrawal or recall is on the rise due to regulations governing product safety. This can result in considerable costs to the insured,” said Christopher McKeon, President of Commercial Casualty’s Commercial Risk & Excess Workers’ Compensation divisions. “In order to manage the effects of a product withdrawal, a sound product liability program is essential for manufacturers, distributors, wholesalers and retailers who may not be able to manage otherwise.”