Agrical warns of possible increase in product liability claims in light of horsemeat scandal

Nigel Collinson, Managing Director of Agrical Chartered Loss Adjusters warns farmers to ensure their processes and paperwork are up to scratch and talks of a possible increase in product liability claims.

“The horsemeat scandal rumbles on as the Food Standards Agency widens its testing regime across many food products.  The last few weeks have brought traceability into sharper focus and the backlash from this sorry affair is a lack of consumer confidence in food labelling and content.

“Undoubtedly this is already having an effect on shopping habits as butchers are already reporting an increase in custom.  Great news for British farmers I hear you say and it is, but the flip side of this is the increase in food standard surveillance both by government agency and the main retailers.

“The paper trail will be used to show where any problem in the food supply chain is.  Farmers need to ensure that their processes are up to scratch and bomb proof through completed documentation and, in some cases, with self-sampling of produce as a further fail-safe. Most farmers have no control over the produce they supply into the food chain once it leaves the farm gate. Consequently when things do go wrong, they need to be able to show that the products produced were fit for purpose and of merchantable quality.

“The insurance industry is keeping a watching brief and although it is reporting that it’s unaffected by the crisis at the moment as food recall cover is only triggered when bodily harm or property damage has occurred, this could all change if drugs used to treat horses have been inadvertently consumed by humans.

“It is highly unlikely that the insurance industry will not be affected and product liability claims will be forthcoming. I also think the end result may be an increase in demand for product guarantee cover due to the tightening of traceability.  This scandal will undoubtedly provide greater transparency in the food supply chain, which is a good thing, but with it comes greater responsibility to all involved that what they supply is what the buyer was expecting.  In some cases the trail may lead right back to the core supplier – the farmer.

“Farmers shouldn’t be alarmed by this but they should ensure their processes will withstand any investigation.”