Cover for the consumer-harm compensation liability of food makers, processors, importers and distributors from food poisoning, foreign objects, allergy and spoilage. For K-Food exports, an extension for the US FDA, EU and China markets is available.
N2N Insurance Brokerage does not represent any single insurer — it independently represents the client as an FSS-registered broker (Reg. No. 2026-012201). We compare the wordings, rates and service of AIG · Chubb · DB · Hyundai · KB · Meritz to propose the cover and price best suited to your risk. Each insurer's full wording is provided at application and binding.
Cover for the consumer-harm compensation liability of food makers, processors, importers and distributors from food poisoning, foreign objects, allergy and spoilage. For K-Food exports, an extension for the US FDA, EU and China markets is available.
Processed, ready-to-eat, HMR makers — a food-poisoning/foreign-object risk core.
Fresh/chilled food distribution — spoilage and transit-accident risk.
Korean distribution of overseas food — import-responsible-party PL.
Own food brand online sales, K-Food exports — a by-market PL combination.
| Export extension | US FDA, EU, China and other markets |
|---|---|
| Recall costs | Recall, transport, disposal, publicity |
| Supply-chain liability | Apportionment with an ingredient supplier |
| Aggregate limit | Response to a mass food-poisoning incident |
| Policy period | 1 year (Occurrence / Claims-Made option) |
|---|---|
| Insurers | DB · Chubb (compared) |
| Limit | Per accident KRW 500m–5bn / aggregate KRW 1bn–20bn |
| Turnaround | 2–4 weeks (including export) |
| Legal basis | Product Liability Act, Food Sanitation Act, Livestock Products Sanitary Control Act |
If the insured event has already occurred at the time the contract is made, the contract is void. However, where the contract is void due to the company's intent or negligence, or where the company knew or could have known of the nullity before acceptance yet did not refund the premium, the company refunds the premium with interest at the policy-loan rate published by the Korea Insurance Development Institute, compounded annually, for the period from the day after payment to the day of refund.
The specific losses not covered (exclusions) are set out in each insurer's policy wording and product description; on this page, see the “Cover” tab(or the “Losses not covered” section) for the main exclusions. For other cover-specific grounds on which claims are not paid, please refer to the policy wording.
The company provides cover, in accordance with the policy, from the time it accepts the application and receives the first premium. Where the company accepts the application after receiving the first premium with it, cover also begins from the time the first premium was received.
The application must be completed by the policyholder, and the policyholder and the insured must sign it by hand. Failure to sign by hand may result in disadvantages regarding the validity of the contract. On an internet cyber-mall, an electronic signature may be used instead.
The policyholder has the right to be given and have explained the information needed about the product they wish to buy.
The insurer and N2N Insurance Brokerage must explain the important matters of the product to ordinary financial consumers.
When applying, the policyholder, the insured or their agent must disclose truthfully the facts they know regarding the questions in the application (including the questionnaire). Otherwise the claim may be declined or the contract cancelled. Where insurance is taken out by telephone or other means of communication, the duty is performed by answering the seller's questions, which are recorded, without a separate written questionnaire, so answers must be given with particular care.
If, after the contract is made, any of the following arises in respect of the subject-matter insured, the policyholder or the insured must notify the company in writing without delay and obtain endorsement on the policy.
The surrender value is the amount paid if the contract is cancelled early. Unlike bank savings, insurance combines risk protection and savings: part of the premium is paid out as claims to other policyholders who suffer accidents, and part covers the insurer's operating expenses, so the surrender value on early cancellation may be less than the premiums paid, or nil.
Under Article 59-4(1) of the Income Tax Act (special tax credit), for protection-type insurance taken out by an employee only, a tax credit of 12% of the premium paid (capped at KRW 1 million per year) is available. Tax matters may change with amendment or repeal of the relevant tax law.
Except as provided by law, the insurer and N2N Insurance Brokerage do not collect, use, inspect or provide personal data related to this contract — for its conclusion, maintenance and claim payment — without the consent of the policyholder, the insured or the beneficiary. However, for those purposes the insurer may, with the consent of the policyholder and the insured and in accordance with law, provide personal data to other insurers and insurance-related bodies.
The above is a summary and excerpt of the policy wording; for grounds on which claims are not paid and other details, please refer to the policy wording and product description.
Five areas of food manufacture, processing and distribution
Processed, ready-meal and HMR makers. A food-poisoning/foreign-object risk core area.
Fresh/chilled food distribution. A spoilage and transit-accident risk area.
Korean distribution of overseas food bears PL as the import responsible-party.
Own food brand sold online. A high-consumer-exposure area.
K-Food exporters. A US FDA / EU / China market-combination area.
A ready-meal (HMR) maker received multiple food-poisoning reports from a newly launched product. Under this wording the cover limit on a mass harm from a single accident was the key issue, and an MFDS immediate-report + recall procedure under the Food Sanitation Act ran in combination. Recall, disposal and publicity costs were handled separately under the recall endorsement, and as contamination of an ingredient was found in the cause analysis, liability apportionment with the ingredient supplier was additionally assessed. A case showing that food PL is not simple compensation but a comprehensive area combining recall, publicity and supply-chain liability.
Source: (General industry example)
The wording and structure points decision-makers most often overlook
A mass food-poisoning incident harming many consumers in a single accident is food PL's biggest risk. The per-accident limit can be exhausted quickly, so a precise aggregate-limit + deductible design is essential; a shortfall means a large own burden.
A food recall has wide social impact, so recall/disposal/publicity costs often exceed the compensation. A separate recall endorsement is essential, and comprehensive cover including the MFDS-report + staged recall-procedure cost is recommended.
There is a labelling duty for allergenic foods (milk, eggs, nuts, crustaceans, buckwheat, etc.) under the Act on Labelling and Advertising of Foods, and an accident from a missing label is assessed as a heavy liability. A labelling-system check + wording review is key at enrolment.
The questions decision-makers ask most when considering food product liability insurance
It covers the compensation liability a food maker, processor, importer or seller bears under the Product Liability Act and the Food Sanitation Act. Compensation for harm from a food defect — a user's food poisoning, foreign object or allergy — is the core area, assessed together with breach of the food-safety-management duty.
Usually (1) food poisoning (bacteria, virus, toxin), (2) foreign-object contamination (metal, hair, insect, plastic), (3) an accident from a missing allergy label, (4) injury from spoiled/decayed food, (5) recall costs (endorsement), and (6) legal-defence costs.
The export area needs a separate territorial-extension endorsement. Each market — US FDA, EU food regulation, China food-safety law — applies different PL law, and food exports usually carry a higher compensation limit, so precise comparison of cover scope, limit and exclusions by market is key.
The biggest risk of food PL is a mass food-poisoning incident where many consumers are harmed in a single accident. Designing the per-accident and aggregate limits, and the multi-victim response process (legal advice, settlement), are combined; an insufficient limit means a large own burden.
Under the Food Sanitation Act a food recall has a set MFDS-report + staged recall procedure. Recall, transport, disposal and publicity costs are a separate recall-insurance endorsement; as a food recall has wide social impact, prompt response is key to minimising loss.
Under the Act on Labelling and Advertising of Foods there is a labelling duty for allergenic foods (milk, eggs, nuts, crustaceans, etc.), and an accident from a missing label is assessed as a heavy liability. This wording covers a labelling-duty-breach accident too, but a labelling-system check is essential in underwriting.
The insurer assesses it on the annual turnover, the food category (processed, fresh, ready-meal, HMR), the export ratio and markets, HACCP certification, the allergy-labelling system and past incident history. The exact premium and acceptance are confirmed after underwriting by insurers such as AIG, Chubb, DB, KB, Meritz and Hyundai.
