Lexington Product Recall Insurance Covers Celebrity Endorsement Risks
American International Group Inc.’s (AIG) Lexington Insurance has introduced Celebrity Product RecallResponse, a new insurance product designed to help customers respond to risks from a celebrity endorser’s public fall from grace, scandal or unexpected death.
Celebrity Product RecallResponse covers certain costs incurred by companies to recall products bearing a celebrity endorser’s name and image. The insurance is triggered by significant news media coverage of an endorser’s actual or alleged criminal act or other distasteful conduct that results in — or is likely to result in— “public contempt for the individual and a significant adverse impact on a company’s product.”
Coverage includes costs associated with removing products and packaging from the marketplace, including their transportation, disposal or destruction. The coverage also reimburses companies for the removal of marketing and advertising materials bearing the celebrity’s image.
“In this age of social media and instant news, reports of indiscretions by celebrities or high profile athletes can spread worldwide instantly, with swift, adverse implications for products or brands associated with the individual,” said Jeremy Johnson, president and CEO of Lexington Insurance Co.
Available with standalone policy limits up to $5 million, or by endorsement with limits up to $1 million, the coverage is designed to provide protection for companies of many sizes, including start-ups, small, and mid-sized businesses that are engaging a celebrity endorser.
Customers also have access to AIG’s RiskTool Advantage to help them assess exposure and prepare and execute a recall plan.
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