Contaminated Product Insurance Policy Held Void Due To Insured's Misrepresentations

A federal appeals court recently held void a product contamination policy issued to H.J. Heinz Company on the basis that Heinz failed to disclose previous contamination claims on its insurance application. ¹

In 2014, Heinz recalled baby cereal manufactured in China after Chinese authorities informed Heinz that it was contaminated with lead. Heinz filed a claim under its Starr Surplus Lines Insurance Company accidental contamination insurance policy, seeking indemnification for losses, and subsequently filed a lawsuit when Starr refused coverage. Starr counterclaimed, seeking to rescind the policy on the basis that Heinz failed to disclose or misrepresented material information in its application for coverage.