Business Interruption Insurance and the Supply Chain

There has been a lot written about planning for supply chain risk and resilient supply chains. Insurers looking to cut claim costs on business interruption insurance now realize planning for supply chain risk and resilience cut significantly cut claim costs in the advent of business interruption.  That is, if the company has such a plan.

If you work in a large firm, say over $500 million in revenue, it likely lead to your insurance department and possible top management asking already about what plans are in place in the case of disruption.

For smaller businesses, whom may never had put together a supply chain risk and resilient planning, this may be start to be a new requirement.

Looking at this from another angle, where management may not wanted to spend money on risk planning and resilient planning, now it has a financial incentive.  It could be a tangible cost which can be reduced by appropriate planning.  By showing better sustainability of the organization, business interruption insurance costs saves can occur.

 

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