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Supply Chain Insurance
How can you protect your profitability and your reputation from supply chain breaks?
How do you mitigate risk in your supply chain?
Supply Chain Insurance is a new product that is designed to cover supply chain failures – when supplies are not delivered or are otherwise delayed – that have a financial impact on a company’s operations. It is currently only available to companies with a head office in Europe. It is an “All Risks” business interruption cover which is not restricted to property damage and focuses on incidents outside the insured’s control such as political and country risks, cyber attacks, ailled communications with suppliers, and breakdowns in their just-in-time delivery strategies. It allows you to risk transfer your supply chain risks for named supplies and suppliers, and has very few exclusions such as deliberate acts, quality of supply, product recall, fraud, war, terrorism nuclear, or infectious disease.
- All risks cover
- Named supplies and suppliers
- Few exclusions
- Value adding risk assessment process, including identification of mitigation action
- Agreed limits per supply/ supplier which helps you understand your profit exposures
- Premium calculated per supply and supplier based on the agreed limit
- Agreed claims methodology (and formula) before inception leading to quicker and easier claims settlement process
- Gives the customer a deeper understanding of their supply chain and the risks within it
- Increased financial protection against supply chain risk outside the customer’s control
- Agreed limits per supply and supplier
- Based on anticipated loss of profit and/or increased cost of working
- Maximum limit USD100 million per customer
- Maximum indemnity period of 12 months. The period begins either from the first reduction in supply or from the first notification of circumstances which subsequently leads to a reduction in supply whichever occurs first.
- Agreed policy limit
- Anticipated customer retention of 10% of Limit (plus co-insurance)
Underwriting will be done by Zurich’s specialist Supply Chain Insurance underwriters in London in conjunction with nominated specialists in Political Risks, NatCat, Credit, Marine and other lines as appropriate.
The policy will initially be written on a Freedom of Services (FOS) basis.
- Changes to the business, the supply or the suppliers, transportation of the supply and contractual agreements between the insured and the supplier must be notified.
- For a loss of two or more supplies which affects the same product, service or business over the same period the limit applying is the largest of those supplies affected.
- Where cover is provided under another policy e.g. Contingent Business Interruption, this cover will provide Difference in Conditions / Difference in Limits protection.
- The Supply Chain Insurance policy will adhere to the principles of our Multinational Insurance Proposition.
Contact details
Nick Wildgoose
Global Product Manager, Supply Chain
Mob: +44 (0) 7764 282065
Email:nick.wildgoose@uk.zurich.com
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