LMI Group has added product recall insurance to its PolicyComparison website for brokers.

Founder and MD Allan Manning says he added the line following broker requests and after LMI dealt with a claim in which the insurer’s lawyer “said he could not think of a single instance that would trigger the policy. The client paid $12,000 for that cover. It was just appalling.”

Professor Manning told insuranceNEWS.com.au there is great variation in policy wordings.

Many clients think their product liability policies will cover product recall, but it is often a specific exclusion because recalls are so expensive.

“In the main, a product liability policy only covers against liability arising from the product, not the product itself, nor a product recall,” Professor Manning said.