Bill Introduced to Show Product Recall Coverage
A bill co-sponsored and introduced by Senators Sherrod Brown (D-Ohio) and Senator Bob Casey (D-PA) will require distributors of certain imported consumer and food products to demonstrate that they have the financial ability to cover risks associated with recalls and product safety.
Under the Food and Product Responsibility Act, a manufacturer would have to obtain a “certification from the U.S. Customs and Border Protection that a manufacturer possess sufficient means (through insurance or otherwise)” for a five-year period to cover the “entire cost of a recall of that product.” What’s more, the company would have to be able to show that it had the means to cover compensatory damages and costs—including attorneys fees—resulting from product liability or other lawsuits involving “any defect in that product.
“We need a new approach to import safety,” said Sen. Sherrod Brown in a statement announcing the bill’s introduction late last week. “We need to inform and protect consumers, while holding distributors accountable for the safety of the products they import.”
The bill would cover auto parts; food, drugs, devices and cosmetics; biological products; consumer products; as well as meat and meat products, poultry and poultry products, and eggs and egg products.
Ken Crerar, president of the Council of Insurance Agents & Brokers in Washington, commended Sen. Brown “for this initiative to respond to the concerns about the safety of imported products.”
“Our member firms sell the overwhelming majority of business insurance products to commercial consumers worldwide, and they already assist most major importers in securing product liability coverage to protect against a wide variety of risks,” Mr. Crerar said in a statement. “Product liability and recall insurance are important products in securing financial responsibility for manufacturers. The Brown bill is aimed at assuring that importers demonstrate that they have the financial ability to cover the exposure of recalls, and it thus contributes to a needed debate on the proper role of government in assuring product safety. We encourage members of Congress to carefully consider these ideas, and we appreciate the efforts of Sens. Brown and Casey.”
Published on September 26, 2007
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