Marsh, AIG offer new supply chain disruption insurance
Insurance broker Marsh, with AIG Commercial Insurance, said it has “developed a breakthrough insurance program that can help companies manage the financial consequences of a disruption to their critical supply chains.”
The new product, which is called Global Supply Secure “is designed to protect companies whose operations rely on critical supplies of goods or raw materials. Under the program, businesses may be able to obtain broad coverage throughout a company’s supply chain, including loss of a supplier, stoppage of the supply itself, or a related interruption in service.”
Marsh said the coverage “can apply to supply chain interruptions stemming from a wide range of perils, such as strikes, political risks, the outbreak of a pandemic, or delay in supply from a variety of causes.”
The broker said it developed the program together with the Lexington Insurance Co. unit of AIG.
Marsh’s risk consulting practice will conduct a comprehensive supply chain risk assessment, and Lexington will then use that assessment to underwrite the insurance coverage through its offices in the United States, United Kingdom, Canada and Bermuda.
“As businesses in nearly all industry sectors take advantage of globalization to reduce costs and achieve efficiencies, their supply chains have become the lifeblood of many of their production, manufacturing and distribution activities,” said Robert Howe, leader of Marsh’s Global Property Practice.
“While the economic benefits of such supply networks are clear, the risks have become more acute and a supply chain interruption can have potentially devastating effects on a business. Our new program approaches business interruption on a broad basis to help companies address a wide range of potential disruptions,” he added.
