Companies in the food industry would certainly agree that producing safe products is of paramount importance. How can you make money if you are making your customers ill? Whether it is a hit to a brand’s reputation or a significant drop in sales, you would think businesses would not need more incentives to do the right thing.

Due to raise in foodborne illnesses and product recalls, President Obama signed into law the Food Safety Modernization Act (FSMA) in 2011. It aims to ensure the US food supply is safe by shifting the focus from responding to contamination to preventing it. FSMA were finalized in 2015 and 2016. These new regulations on food safety carry criminal penalties.

In an effort to keep our clients informed of important issues in a timely manner, JGS Insurance held a seminar — The Food Safety Modernization Act (FSMA) “Bites” — in March of this year to inform companies in the food industry what they need to know to protect themselves. The seminar touched on various FSMA-related topics, including the following:

Criminalization of foodborne illness – What can you do to protect your company?

Strategic risk transfer – What is an insurance policy after all?

Product liability and recall claims – Do you know what to do if it happens to your company?

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If you’re in the food processing industry and responsible for your company’s quality assurance program, watch out! This year, the Food and Drug Administration (FDA) is poised to take a giant step further toward meeting the safety standards established by the Food Safety Modernization Act (FSMA), which was signed into law on January 4, 2011, but became fully effective just last September. Under the new regulations, the FDA will considerably strengthen its food safety and enforcement protocols, holding all responsible parties to a much higher standard. By including provisions for criminalizing food safety failures, the FDA is demonstrating its intent to go after foodborne illnesses much more aggressively than it has in the past.

By way of background, the FDA began computerized tracking of food contamination through the Reportable Food Registry in 2009. Once companies began systematically reporting their contamination cases, a plethora of high-profile companies were cited including, most notably, Chipotle Mexican Grill in 2015. These outbreaks led to a public and regulatory outcry, which resulted in much stricter regulations. Under FSMA, the FDA now has the power to initiate unannounced inspections, conduct huge retail food testing programs, recall vast product inventories and initiate criminal procedures against offenders—even those with no prior knowledge of the contamination.

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