2016 Emerging Trends in Product Recall and Contamination ...

1 Aon Risk Solutions Crisis Management 2016 Emerging Trends in Product Recall and Contamination Risk Management A crisis may be unpredictable, but it should not be unforeseeable Risk. Reinsurance. Human Resources. Table of Contents Significant Product Safety Incidents.. 4. Major Food Safety Incidents of 2015 .. 4. Food Service and Restaurant Contamination .. 5. International Incidents .. 6. Malicious or Deliberate Product Contamination .. 6. Automotive Product Recalls .. 6. Significant Recall Events 1982 to 2015 .. 8. Rules and Regulatory Changes .. 12. The FDA Takes First Steps in FSMA Implementation .. 12. Safe Food Act of 2015.. 12. Surveillance and Sampling Capabilities.. 13. New Technologies Leading to Faster Detention .. 13. Industry Trends .. 15. Managing the Supply Chain Risk.

2 15. Social Media Monitoring .. 16. Carriers and Market Update .. 17. 2015 Carrier Update .. 17. 2015 Global Recall and Contamination Market Capacity .. 20. Product Recall and Contamination , Analytics & Modeling.. 22. Claims Preparation, and Advocacy.. 24. 2015 Recap / 2016 Outlook.. 25. Aon Risk Solutions | Crisis Management 1. The Product Recall and Contamination insurance market continued to expand and develop in 2015. Coverage is becoming more commonplace with an increasing number of companies purchasing policies to supplement their risk management programs. New carriers provided additional capacity and policy wording continued to develop around new exposures and case law. Several high profile events influenced the manner in which underwriters view and approach risks while regulators and the media continued to focus on issues of Product safety.

3 This publication seeks to provide readers with updates on the risk management of Product Recall and Contamination . It also summarizes some of the significant events during the past twelve months, reviews new rules and regulations, and provides updates on the insurance marketplace including tools available to assist firms in evaluating and mitigating their risk. 2016 Food Safety Risk Management Trends Food Products New FSMA Rules Restaurants and Food Service Safe Food Act of 2015. Automotive Products Surveillance and Sampling Recall & Regulatory Contamination Changes Events Industry Carrier/Market Focus Changes Social Media Increasing Capacity Supply Chain Integrity New Carriers Vendor Management Wording Clarity Aon Risk Solutions | Crisis Management 3. Significant Product Safety Incidents of 2015.

4 Major Food Safety Incidents Although Blue Bell ice cream is only available in about 30% of the nation's supermarkets, it is one 2015 began with one of the largest and most of the top three best-selling ice cream products in publicized Product recalls in history. On March the country. Blue Bell shut down all its' operations 13, 2015, Blue Bell Creameries of Brenham, TX and laid off 1,450 employees as a result of the announced the company's first Recall in 108 years. outbreak. On July 14, 2015, Blue Bell announced Blue Bell voluntarily recalled all of its products that prominent Texas business investor Sid Bass made at all of its facilities, including ice cream, had become an investor with the company. frozen yogurt, sherbet and frozen snacks, because they had the potential to be contaminated with Additionally, in early 2015, a diverse range of Listeria monocytogenes.

5 A public letter was issued products were recalled by numerous based on March 27, 2015 to customers and retailers companies due to potential peanut powder on the company's website apologizing for any Contamination of the spice cumin. Consumers anxiety or inconvenience the Recall had caused. with severe allergic reactions to peanuts were at significant risk due to this undeclared allergen. According to the Center for Disease Control Several companies received shipments of the ( CDC ), illness onset dates ranged from ground cumin that contained the undeclared January 2014 to January 2015. Listeriosis is a peanuts, which were subsequently used as life-threatening infection caused by eating food an ingredient in products ranging from soups contaminated with the bacterium (germ) Listeria and sauces to meat products.

6 The source of monocytogenes (Listeria). A total of ten people with the Contamination was traced back to Turkish listeriosis related to this outbreak were reported suppliers of the spice. What made this Recall more from four states: Arizona, Kansas, Oklahoma, difficult was that frequently the ingredients listed and Texas. All ill people were hospitalized and spices, and did not specify ground cumin. three deaths were reported from Kansas. The cumin Contamination sparked global food safety concerns with the United Kingdom LISTERIA AND BLUE BELL ICE CREAM. Contaminated production facilities and illnesses linked to Blue Bell Creameries government's new food crime unit launching an CDC recommends that people not eat, serve, or sell any recalled Blue Bell brand investigation sparking off the Nuts-for spices products.

7 This complicated investigation of a listeriosis outbreak involved serious illnesses from 2010 through 2015 linked to two Blue Bell production facilities. crisis in the UK which spread across Europe. It Kansas 5 cases in one hospital linked to Oklahoma was reported as being a scandal even more ice cream made in Texas facility, 1 case linked to . Arizona 1 case linked to ice . resulting in 3 deaths ice cream made in . Oklahoma facility serious than the horsemeat crisis of 2013. cream made in Listeria found in ice . Oklahoma facility cream products and . in Oklahoma . facility where they . were made The Recall of cumin was expanded to include Alabama recalling products that contained paprika Listeria found in . Alabama facility when a supplier to one of the UK's major No cases linked to.

8 Texas supermarkets found undeclared traces of Alabama facility 3 cases in separate . hospitals linked to . ice cream made in . Oklahoma facility Listeria found in ice . Human illness(es). almond protein in batches of paprika used in Alabama Blue Bell production facility cream products made . in Texas facility Texas Blue Bell production facility various products. Paprika is also the other most Oklahoma Blue Bell production facility Illness(es) linked to Texas facility popular ingredient in European cooking. Illness(es) linked to Oklahoma facility Learn more: As the alert escalated, food watchdogs in Denmark, CS255971A. CS257655B. Sweden and Norway recalled about three dozen products containing almonds in place of paprika. 4 2015 Emerging Trends in Product Recall and Contamination Insurance Significant Product Safety Incidents of 2015.

9 On September 4, 2015, Andrew & Williamson Chipotle Mexican Grill, Inc. (CMG). Fresh Produce voluntarily recalled all cucumbers $696. sold under the Limited Edition brand label Shareholder (EST). $633. after the CDC, and the FDA investigated a $570. multistate outbreak of Salmonella Poona infections linked to imported cucumbers from $507. Mexico. One-hundred-sixty-five people were $445. hospitalized and four deaths were reported. $382. The above joint investigation utilized the CDC's PulseNet system to identify illnesses that were Chipotle has undertaken the following remedial part of this outbreak. Since 1996, PulseNet has measures: a comprehensive reassessment of their connected foodborne illness cases together, food safety practices, which includes enhanced in order to detect and define outbreaks.

10 DNA DNA-based testing of all fresh produce before fingerprinting was performed on Salmonella it is shipped to restaurants; shelf-life testing to bacteria isolated from ill people using a technique ensure that quality specifications are maintained called pulsed-field gel electrophoresis, or PFGE. throughout the shelf life of an ingredient;. PulseNet manages a national database of these improvements in vendor and supplier testing;. DNA fingerprints to identify possible outbreaks. and enhanced internal training of employees. In early 2016 , a class action lawsuit was filed Food Service and Restaurant Contamination against Chipotle alleging that the company Food service and restaurant chains also suffered provided misleading information to investors. defining food safety events in 2015 with Chipotle Specifically, the suit, filed in the District Mexican Grill being the most high profile.