Released on: December 1, 2007, 3:51 am

Press Release Author: Alexandra Lewis

Industry:

Press Release Summary: The reputation of England's fledgling vineyards could be
destroyed and sales could slump if they do not plan how to manage a product recall,
according to Aon, the UK's leading insurance broker. In Aon's Vine to Wine report,
looking at the risks throughout the wine lifecycle, vineyards are warned that a
bottle of contaminated wine hitting the shelves could result in a surge of adverse
publicity and the risk that sales will never recover.

Press Release Body: The reputation of England's fledgling vineyards could be
destroyed and sales could slump if they do not plan how to manage a product recall,
according to Aon, the UK's leading insurance broker. In Aon's Vine to Wine report,
looking at the risks throughout the wine lifecycle, vineyards are warned that a
bottle of contaminated wine hitting the shelves could result in a surge of adverse
publicity and the risk that sales will never recover.

"The UK's £16 million wine industry consists of small producers, but we're beginning
to see them building their brands, for example, through winning 16 awards at the
International Wine and Spirit Competition in 2006. As this happens, protecting these
and their reputations will become increasingly important for their success,"
explained David Palmer, director at Aon's crisis management team." A product recall,
as result of accidental or malicious incident, could ruin a vineyard's reputation
and customer base. It can take a long time to win this business back."

Aon's first Global Risk Management Survey found that more than half of executives
see damage to reputation as the number one concern to business and, worrying,
reported recalls or safety notices from the UK in 2006 more than doubled from the
previous year¹. As well as potentially losing customers, anyone producing an unsafe
product could face prosecution and a possible prison sentence of up to two years
under the General Product Safety Directive.

Understanding what problems can occur is the first step to preventing a recall. The
biggest risks to wine include:

* contamination - for example, if grapes have been sprayed with a pesticide or
if a foreign body, such as a chemical or glass shards, finds its way into the
wine;
* design faults - in March 2007, for example, a European drinks company recalled
a batch of its Chenin Blanc Chardonnay Semillon because of a fault in the bottle
that could cause the bottle neck to break when the cork was pulled out;
* labelling - an incorrectly labelled bottle, or one that fails to mention
constituents such as allergens, is considered a dangerous product.

Risk management can significantly reduce the potential for problems. "Producers must
use quality control procedures to prevent producing an unsafe product. This involves
testing right throughout the production process, from checks on the raw ingredients
to reviewing the labels on the final products," added David.

Even the most robust checks won't always guarantee the quality of the final product.
This is where contamination and recall insurance can provide a financial safety net.
Insurance can cover you for the destocking and lost revenues of the recalled
product.high
value home insurance


While financial compensation can make the difference between a business surviving
and going under, the response facility on recall insurance helps to minimise the
impact on your reputation. David continued: "Reputational risk can be worth much
more than the lost product and managing this should be a crucial part of vineyards'
crisis management plans. Companies need to update their view of PR from focusing on
pure promotion to having the ability to protect your reputation and in turn the
health of your business."

Aon UK is ranked by A.M. Best as the number one global insurance brokerage based on
brokerage revenues and voted best insurance intermediary, offering classic car
insurance, high
value home insurance, entertainment and media liability insurance and
construction insurance.


Web Site: http://www.privateclients.aon.co.uk/privateclients/microsites/household/

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