In March of 2020, and in response to COVID-19, the Consumer Product Safety Commission (CPSC) sidelined federal safety inspectors from their regularly assigned posts. For nearly six months, ports around the U.S. remained unmanned as shipments of holiday toys imported from around the world were offloaded and distributed across the country — unbeknownst to American consumers and without disclosure to Congress.
According to an article by USA TODAY, the CPSC privately shutdown ports and a government testing laboratory in early spring through September of 2020 — the busiest months for safety inspectors who are tasked with intercepting bad toys and household products in anticipation of the upcoming holiday season. A year later, many inspectors still aren’t back on the job in five of the 18 normally patrolled U.S. ports, including the nation’s largest commerce hubs located in Chicago, New York, Savannah and Georgia, USA TODAY reported.
In an effort to help the CPSC get back on track, the recent stimulus bill passed by Congress this March included a hefty $133 million annual budget that is earmarked to help the CPSC get back to the business of enforcing safety standards in consumer products. In addition, the CPSC is working in compliance with congressional orders to report on how the organization plans to move forward with initiatives to address potentially dangerous products that may have entered the U.S. during that six-month shutdown period.
Government Product Recalls
Unlike the U.S. Department of Agriculture, the U.S. Food and Drug Administration and the National Highway Traffic Safety Administration, the CPSC handles recalls relating specifically to products made available to consumers that are not food or vehicle related. The CPSC generally begins a recall event when it is alerted by a company that a possible problem exists, or when it receives media or consumer reports indicating a problem. At that time, a recall may be issued due to safety issues involving health hazards or design/manufacturing defects that could potentially cause safety or health hazards for consumers.
At this point in time, it’s uncertain whether last year’s events will trigger a tsunami of product recalls due to dangerous products that may have entered the country. What we do know is that if products are found to be hazardous or if consumers are directly harmed by certain products, a nationwide recall event could occur.
It’s important for your clients to consider the different ways in which their company could be found at fault for damages resulting from the use of their product(s). They must also understand their own responsibility of reporting potential product issues as soon as they are detected, as any reporting delays or refusals to report a recall issue could result in the CPSC obtaining a court order to force the recall.
The fact is, a product recall can be costly and damage a company’s reputation. Product recall insurance can help defray the operational costs of a recall, as well as costs associated with the re-establishing of a company’s brand.
At Worldwide Facilities, we have the expertise and market reach to provide your clients with comprehensive product recall insurance to help them get on the road to financial and reputational recovery. To learn more about our products and services, or for coverage questions, please contact Lori Hunter at 213-236-4585 or firstname.lastname@example.org.