Food Spoilage
Food spoilage is a major headache for restaurants, grocery stores, wholesalers, and other food service businesses. Spoiled food represents money literally washed down the drain. It may also expose your business to liability risks if a patron consumes spoiled food and, as a result, becomes ill with food poisoning or another type of foodborne illness.
Food spoilage occurs when specific microorganisms grow in the food. The food may lose its taste or texture, or its appetizing smell. Not all microorganisms growing in food will cause sickness to those who consume it. However, most restaurant patrons aren’t going to eat an unappealing or unappetizing food. Of course, most restaurateurs aren’t interested in offering anything but the best to their customers.
What is Food Spoilage?
Pathogenic bacteria strains, such as e. Coli or salmonella, may grow in the food. If the food is left out at warmer temperatures—between 40 – 140 degrees Fahrenheit—it may begin to grow a pathogenic bacteria. The U.S. Department of Agriculture (USDA) reports that, in most instances, the food won’t have a bad taste or foul odor to alert the consumer of the spoiled food.
Why is Food Spoilage Insurance Important for Groceries and Restaurants?
Grocers or restaurant owners might not know about spoilage insurance until it’s too late. For instance, after a severe weather event or another disaster that causes a power interruption, refrigerated or frozen food may get warmer and begin to grow bacteria.
The unknowing restaurant owner might not see or smell a difference in the food quality and, in an interest of preserving his or her financial health, might choose to cook and serve the food to patrons once power is restored.
Unfortunately, concerns about lost money could result in a lawsuit if a patron suffers food poisoning.
What You Should Know about Food Spoilage Insurance
In most cases, adding food spoilage insurance to an existing commercial insurance policy is relatively inexpensive. If you’re a restaurant owner in Texas, consider adding food spoilage insurance to your policy if you don’t have it already.
Many restaurants have food spoilage insurance but, in the aftermath of a major flood or hurricane, might not think to file a claim. Spoiled food can result when refrigeration and cooling equipment malfunction or power outage leads to food spoilage.
There’s never a good time for a restaurant to lose food stores to spoilage. If you’ve experienced food spoilage, it’s time to review your policy language and comply with the insurer’s requirements to prepare and submit a commercial claim. Doing so can avoid a major financial disaster for your business.
Hurricanes, earthquakes, windstorms, and floods can shut down your utility service for weeks
A major storm can leave millions without power for days, weeks, or longer. If your business is located along the Southeastern coast of Texas, you may purchase commercial property insurance to cover direct damage or physical loss to your property.
You may also buy business interruption insurance. This insurance will reimburse business income that’s lost in unavoidable circumstances.
Some businesses don’t recognize that business interruption cover might not include service interruptions, such as if a severe windstorm knocks down electrical wires and plunges the restaurant into darkness. Unfortunately, an interruption related loss may be catastrophic to the business.
Your business might experience a major plumbing failure, fire, or another disaster. If your claims aren’t paid by a commercial insurer to whom you’ve regularly paid premiums for years, you might not have the opportunity to get back on your feet quickly.
Even if you previously purchased food spoilage and/or business interruption insurance from your commercial carrier, the insurer might deny your claim. In the above example, the insurer might deny the claim on the basis of the policy’s power exclusion.
Grocery stores and food service businesses have unique problems that others don’t have
Grocery stores and other food service businesses sell perishable products. These products require refrigeration or freezing. Some products are simply inedible if they’re exposed to moisture or water. A mold may form on the food.
Damaged machinery or equipment can prohibit the grocer from its ability to sufficiently restock the shelves. It can’t serve its customers.
When the grocer can’t function, it may also lose profits, inventory, and customers. It must get financial relief quickly—and receive fair treatment from its commercial insurance company. A business interruption, wind, property, or food spoilage claim, or any other sort of grocery insurance claim that’s underpaid, delayed, or wrongfully denied can have serious repercussions for the business owner and the community it which it operates.
Consult with an Experienced Texas First Party Commercial Claims Lawyer
If you own a grocery store and your commercial insurance claim has been delayed, underpaid, or improperly denied, you need a knowledgeable Texas insurance claim attorney who will appeal the insurer’s decision and fight for your ability to get the fair compensation you anticipated at the time you took out the insurance policy.
Delays and other bad acts of the insurer may result in devastating consequences of lost sales, profits, and customers.
Commercial insurance policy language is often confusing and complex. You may benefit from an experienced first party commercial claims lawyer. We will thoroughly review the language of your commercial insurance policy and assist you at any stage of the commercial claims process. We will work with you to prevail against commercial insurers acting in bad faith.
According to Chapter 541 of the Texas Insurance Code, your commercial insurer has a duty to promptly process valid claims. It must provide a reasonable explanation if your claim is denied. If your commercial insurer acts in bad faith, you have the right to bring a lawsuit against the insurer.
Contact the Mindiola Law Firm if you have questions or concerns about a food spoilage claim at now.