Restaurant Insurance: Food Borne Illness Occurrences
The CDC estimates that 48 million people each year gets sick from contaminated food. This equates to 1 in 6 people in the US. The most dangerous string of contaminants is Salmonella which causes more hospitalizations and deaths than any other food borne germ. This sweeping epidemic is causing many restaurateurs and food providers to turn to their insurance carriers during the litigation process.
Insurance disputes surrounding widespread food borne illnesses are prevalent among the litigation of claims and the outcomes are anything but consistent. The largest concern that the court, insurer, and insured face with these types of cases is determining the number of occurrences directly resulting from each case. This is especially true in the event that the infections cross state lines, as there may be several jurisdictions involved. In the case regarding the salmonella found in cantaloupes originating from a farm in Indiana, there were 261 people affected by two different strains over 24 states. Of those individuals, 94 were hospitalized and 3 deaths were reported due to the infection. Since this outbreak is linked to a single source, courts are trying to determine if this should this be considered 261 occurrences or 1?
Another example of a potential occurrence issue is the E.coli bacteria, which the CDC has stated that the frequency of outbreaks have been cut in half since 1997. In 2013, a multi-state outbreak of the illness was traced back to ready-to-eat salads that affected 33 individuals over 4 states. Of the infected 32% individuals who were hospitalized, luckily no deaths were reported. Again, would this be 33 separate occurrences or 1 single occurrence?
Below is the list of CDC’s Multistate Outbreaks for 2013
- Ready-to-Eat Salads – Escherichia coli O157:H7
- Foster Farms Chicken – Salmonella Heidelberg
- Raw Shellfish – Vibrio parahaemolyticus
- Fresh Produce – Cyclospora
- Crave Brothers Farmstead Cheeses – Listeriosis
- Pomegranate Seeds – Hepatitis A
- Tahini Sesame Paste – Salmonella Montevideo and Salmonella Mbandaka
- Cucumbers – Salmonella Saintpaul
- Frozen Food Products – Escherichia coli O121
- Chicken – Salmonella Heidelberg
- Ground Beef - Salmonella Typhimurium
Each company should be aware of their potential risks and the developments in how the courts are ruling regarding the occurrences of a food borne illness outbreak. An experienced hospitality and restaurant insurance agent and trusted advisor may not be able to mitigate every risk surrounding food borne illness, but with a full understanding of your business, they can package a group of coverages to sustain the restaurant in the in the midst of these liability claims and allow the business owner to focus on what they do well.
Swingle, Collins & Associates specializes in restaurant insurance coverage The descriptions of coverages listed on this website are brief and subject to the provisions, limitations, and exclusions that can only be expressed in your policy and related endorsements. For additional information of how Swingle, Collins & Associates can assist in meeting your coverage needs for food/wine spoilage, food contamination, or delivery/valet insurance please contact your dedicated risk manager to discuss the benefits and services of personal homeowners insurance coverage.
The information contained on this page is provided for informational and educational purposes only. It contains general information on insurance issues and may not reflect the most current developments in insurance coverage and is unlikely to apply in all factual scenarios. The information does not include all the terms, coverages, exclusions, limitations or conditions that may be contained in the actual insurance contract language. The policies themselves must be read for those details. Sample policy forms will be made available upon reasonable request.