Loss Control Tips for Food Distributors

Published in All Insurance Industry Insights on Tuesday, July 16, 2024

Owning and operating a food distribution company can be a rewarding endeavor. These businesses play a major role in the overall food distribution process, serving as the link that connects a wide range of customers (e.g., hotels, restaurants, cafes, corporate cafeterias, hospitals, schools and universities) with high-quality food products. However, operating a food distribution business also carries significant risks. After all, food distributors have to manage various property, product and liability exposures. That’s why it’s vital to have effective loss control measures in place. 

Premise and Operations Liability

Food distribution operations pose various liability concerns. For example, third-party property damage and injuries can lead to costly liability claims. There is also potential for significant fire issues due to merchandise being stored in one large area. Therefore, it’s important for food distributors to take the following measures to limit their premises and operations liability:

• Implement a housekeeping program to ensure floor surfaces are kept clean and dry to prevent slips, trips and falls from happening. Spills should be cleaned up promptly, and the area should be kept free of debris.
• Ensure there is an emergency response plan in place and that it’s communicated to each employee.
• Make sure indoor (e.g., hallways, stairs) and outdoor areas (e.g., sidewalks, parking lots) are free of hazards, such as snow, ice, potholes and uneven surfaces. Walkways should be well-lit, especially entrances, exits and stairways.
• Make sure there are proper ammonia detection systems in place if ammonia refrigeration equipment is used to alert personnel of a leak. Employers must have an emergency response plan for refrigeration units and how to respond.
• Establish a quality control program to monitor products. In addition, inspection controls should be used to prevent the distribution of contaminated products or the acceptance of damaged goods.
• Ensure there is a food safety program established and employees are trained in the requirements of food safety.

Automobile Liability

Because food distributors often have their own fleet of vehicles and employees frequently travel between different job sites, commercial auto exposures are substantial. In particular, accidents on the road could result in serious ramifications, including employee injuries, costly property damage and potential liability issues involving pedestrians or other motorists. To minimize commercial auto exposures, food distributors should follow these protocols:

• Make sure all drivers possess acceptable driving records. Specifically, it’s important to secure motor vehicle records (MVRs) for all drivers. MVRs should be updated annually.
• Provide employees will proper training on safe driving measures. Be sure to prioritize loading procedures so employees load vehicles appropriately.
• Prohibit employees from using their cellphones while driving.
• Consider utilizing telematics technology within commercial vehicles to identify employees’ risky driving behaviors (e.g., speeding and hard braking).
• Implement an effective vehicle inspection and maintenance program. Such a program can help ensure all commercial vehicles remain in good condition and are safe to operate.
• Review all commercial vehicle and trailer characteristics (e.g., size and weight) to determine applicable Federal Motor Carrier Safety Administration (FMCSA) regulations. Routinely monitor compliance with FMCSA standards and make operational adjustments as needed.

Learn More

It’s essential for food distributors to implement proper risk management precautions to limit costly insurance claims and lawsuits. It can also offer various benefits, such as greater customer satisfaction, bolstered employee safety, fewer liability concerns and reduced potential for property damage.
Although this resource provides a range of loss control strategies, food distributors don’t have to establish their risk management programs alone. Working with a qualified and experienced insurance professional can make all the difference. Contact us today to discuss insurance solutions and additional loss control techniques for food distributors.