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Don’t Let An Advertising Claim Wreck Your Business: How Nutraceutical Insurance Can Protect You

nutraceuticals sitting on table

According to the Federal Trade Commission, “ads that make health or safety claims must be supported by “competent and reliable scientific evidence” – tests, studies, or other scientific evidence that has been evaluated by people qualified to review it. In addition, any tests or studies must be conducted using methods that experts in the field accept as accurate.”

Business owners everywhere want to market a product that is desirable for customers to purchase. However, in advertising, how far is too far on claims? Airborne took their marketing claims to new heights and ended up in the courtroom because of it. It can happen to you too. This company’s unfortunate event illustrates how important nutraceutical insurance is for business owners.

Don’t get caught up in a lawsuit and a pile of legal bills without the proper insurance. The right coverage can make a world of financial difference and keep your business afloat while navigating through the rough waters of a legal battle.

Here’s What Happened With Airborne

Airborne, a herbal and vitamin formula, marketed their product line to customers as an effective way to prevent and treat colds, until a consumer complained that the product did not work as advertised. The company was dragged into a class-action lawsuit for false advertising claims. Not only was the company under scrutiny by 24 state attorneys general and the Federal Trade Commission, but Airborne paid $23.3 million dollars in a settlement.

“For a product that consists of vitamins, minerals, and herbs, there is nothing in the formula that constitutes a claim that it prevents common colds from happening. Furthermore, “One of their more outrageous claims is that you take it before entering a germy environment and you’re instantly protected,” David Schardt, senior nutritionist for the Center for Science in the Public Interest (CSPI).

For a company that makes millions of dollars per year, contracting and paying for legal help isn’t something that makes a huge difference in their bank account. However, could your company deal with the defense costs over a lawsuit? It can be financially detrimental for a majority of businesses.

Nutraceutical Insurance Can Cover Lawsuit Expenses

Even if you aren’t found negligent or at fault, you could still be facing thousands of dollars just to defend yourself from a lawsuit. Lawyers alone can charge $100-400 per hour, depending on the area, area of expertise, and years of experience.

Here’s are some litigation costs you’ll pay out of pocket.

  • Court filing, processing fees, and evidence
  • Any late fees
  • Hiring experts in the industry
  • Travel expenses for yourself and legal team

False marketing claims can wreck a business. With a costly legal battle and a mountain of bills with your name on them, the cost can potentially shut down business operations for good. However, with the help of nutraceutical insurance, you can offset the legal costs and focus on your business. Don’t get caught in a bind without it.

All policies have conditions, limitations, and exclusions; please read the policy for exact verbiage. Claim scenario circumstances vary in nature and similar claims do not guarantee coverage.

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Product Liability for Vitamins & Dietary Supplements

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Get Covered With

Product Liability for Vitamins & Dietary Supplements

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