Product recalls can seriously damage a company’s revenues, reputation and profitability. There is not only the financial cost to consider – brand integrity may be jeopardised, senior management exposed to criminal sanctions, government or regulators may intervene in the business operations and the company’s ability to compete globally in the future could be seriously impaired.
How PwC can help you
Our product recall service is designed to assist insurers and policy holders as well as non-insured parties in a variety of product recall matters. These include:
- Evaluating insurance coverage requirements and advising on insurance policy wordings to ensure that a business is adequately covered in the event of a product recall
- Preparing a diagnostic assessment of the company’s readiness and ability to perform an effective recall
- Preparing a report setting out the claims and recoveries (whether from insurers or third parties), in particular:
- Managing and capturing the documentary evidence required to support the claim
- Managing the procedures to deal with recall related issues
- Quantifying the volumes and values of stock recalled
- Evaluating the economic justification of product rehabilitation expenditure
- Calculating the additional costs incurred during the recall (for example, haulage costs, storage costs, media costs)
- Quantifying the loss of profits during the recall and future losses arising as a result of the impairment of brand value
- Providing crisis management advice, including communications requirements
- Providing expert evidence in subrogation and other legal actions where required, from experts with considerable experience of the provision of expert opinion in the litigation process
We are also able to handle any liability claims resulting from the recalled product and provide risk prevention and risk management advice to help avoid further incidents. Our claims experience ranges from multimillion dollar international recalls to significant localised incidents.
