This article supports a previous blog I wrote, “Health Supplements Biggest Problem – Undeclared Substances”.  In this blog I reference a study that indicates that up to 25% of all health supplements in the market could contain undeclared substances.  This study did not indicate that all the undeclared substances were harmful, but it is, just the same, disconcerting not knowing what is going into your body when you take a health supplement.

What I find fascinating is that while the folks at bodybuilding.com maintain that they were not aware of any unlawful substances going into their health supplements, I cannot help but wonder, since they were in the body building business, if they were trying to gain an unfair advantage over their competitors.  If you go to their website, you will see grandpa’s before and after pictures.  In the after picture, grandpa has a body most 26 year old guys could only dream of.  Give me what he is taking! On second thought, I think I will pass.  If steriods were unknowingly in his health substances, he could have an increased risk of heart attack, stroke and death, not to mention acute liver damage, shrinking testes and male infertility.

I wonder what Bodybuilding.com’s product liability insurance carrier is thinking.  My bet is their product liability policy has either been cancelled or they have been notified that they will be non-renewed.  The policy was more than likely a claims-made policy and once cancelled will not cover any of the  prior or future incidences by their customers such as liver damage, stroke, etc. that may have been caused by unknowningly ingesting steriods. 

I, also, wonder what person liability will be assigned to the owners or stockholders of the company in the future, if it turns out that there was knowledge that steriods were being used in their dietary supplements.  Every General Liability policy has an exclusion for intentional acts and even if a product liability lawsuit was filed against the company, it is likely their insurance carrier could deny coverage.  With no insurance coverage for the company, plaintiffs may have a case to go after personal assets of the company principles.

What I find most difficult about this statement is there is almost never any independent test data to back up these assertions and the products that are so safe are often being imported from a foreign manufacturer where the prospect likely has little or no control on the overall quality control.  However, those that do have independent test data to back-up their assertions are typically very well received by the product liability insurance underwriters and do receive better than average insurance premiums and rates.

Even if you product is safe, it is important to understand when you purchase insurance, you are participating in a product liability pool with businesses that sells products similar to your own or a similar class of products such as sporting goods, dietary supplements, etc.  One or two product liability claims can result in sever losses by your product liability insurance carrier; even if was not your product that caused the loss.

If you are one of the many that believe being a product liability insurance carrier is a license to print money, I strongly recommend that you go to www.recalls.gov.  The number of recalls in just one month will astound you.  To have a product recall there must be imminent danger that the product in question could or has caused bodily injury or property damage so all of those products being recalled represent potential product liability lawsuits.