You’ve probably heard a lot about superfoods. From acai berries to kale, hemp hearts and sesame seeds, the term “superfood” is used to describe foods that are packed with nutrients that are good for your body. These are usually fresh fruits and vegetables, seeds, and spices, but also can also include things like fish oil, which is full of healthy fats.
Processed foods lack many of the nutrients we need to stay healthy and fit, and contain ingredients like artificial sweeteners. Food grown on large factory farms isn’t much better; the soil has often been depleted of micronutrients by overfarming and lack of crop rotation. That’s why more and more health conscious individuals are turning toward nutritional supplements.
These can be gummies, pills, or even powders, which are commonly used in smoothies. Superfood smoothies are a favorite of people who are constantly on the go and need quick fuel between work and the gym.
In 2019, the global supplement market was estimated at more than $123 billion, and is growing at over 8% annually. And with supplement companies constantly trying to stay on top of the latest trends, they are always innovating new products -- this year, it’s all about goji berries, beets, and Matcha tea, among other things.
All of this adds up to a tremendous need — and opportunity — for insurance brokers.
Assessing Risk Exposure for the Superfood Industry
When providing insurance coverage for companies that make and sell superfood products, it’s important to have a deep understanding of the risk exposures. A variety of different extraction and preservation methods can be used that carry different risks. The sourcing of ingredients can also play a key role, especially in products like Matcha tea, where many conscientious consumers want to know the sourcing methods, and be assured they are purchasing organic, fair trade products.
Some of the other exposure elements we look to assess include:
- Health claims made on the labeling
- Quality control measures
- Quality assurance programs
- Product recall procedures
- Compliance reviews by outside legal counsel
- Third party product testing
While superfoods have many purported health benefits, and many people swear by them, one of the biggest exposures companies face is overpromising on the health benefits. That is why it’s so important to have outside legal counsel review the labels and marketing materials to ensure they comply with FDA and FTC guidelines, and are not making any unsubstantiated health claims. The third party laboratory testing also helps ensure the products are pure, and free from any chemicals, bacteria, or other harmful substances that could result in claims if the products reach market.
Our dedicated national underwriting team at Admiral has exceptional expertise in health, nutrition and lifestyle products. Not only do we understand the risk exposures, and know what to look for when helping brokers write coverage — we also know what nutrition companies need, and are able to provide a full range of insurance solutions in addition to product liability coverage.
We cover many ingredients that may not be covered under other policies, and offer additional coverage solutions to protect businesses, including:
- Coverage for vendors and trade shows
- Prop 65 civil penalties reimbursement coverage
- Product withdrawal expenses
- Cyber/Data Breach Coverage
If you are a wholesale broker in need of an insurance partner with deep expertise in the nutrition industry, contact us to become an appointed broker. If you are a retail insurance broker with clients that include health and nutrition product manufacturers and distributors, we urge you to connect with one of our wholesale partners.
Products and services described above are provided through various surplus lines insurance company subsidiaries of W. R. Berkley Corporation and offered through licensed surplus lines brokers. Not all products and services may be available in all jurisdictions, and the coverage provided by any insurer is subject to the actual terms and conditions of the policies issued. Surplus lines insurance carriers do not generally participate in state guaranty funds and insureds are therefore not protected by such funds.