MWW Group (for ISO)
MWW Group (for ISO)
ISO Adds Links to Supply Chain Coverage Options
JERSEY CITY, N.J., April 23, 2012 — ISO announced today that it has filed a new endorsement that will enable commercial enterprises to address supply chain loss exposures more fully. ISO is a member of the Verisk Insurance Solutions group at Verisk Analytics (Nasdaq:VRSK).
“Most businesses — manufacturers, retailers, and service providers alike — rely to some extent on other entities to supply materials, products, or services needed to ensure the continuity of their own operations,” said Kevin Thompson, senior vice president of ISO.
“The interdependency of the many sectors of the business community became an issue of global note following last year’s tragic earthquake and tsunami in Japan, as well as the extensive flooding throughout Thailand’s manufacturing heartland,” Thompson explained. “The repercussions of those events and their effect on the global supply chain are still being felt. This has turned the spotlight on the importance of planning to mitigate the risk of supply chain disruption — and the need for insurance to address the potential financial impact of an unavoidable disruption.”
Business interruption coverage has long addressed loss from covered perils associated with supply chain disruption, focusing primarily on known suppliers (and recipients) who deal directly with the insured business. This new option extends dependent property coverage with respect to situations when a supplier is unable to deliver products or services because of an interruption in the business of an entity upon which the supplier depends. That type of situation was encountered by certain car manufacturers and computer hardware manufacturers when silicon microchip production in Japan was interrupted following the earthquake and tsunami. The new coverage option, which pertains to supplier and recipient properties, provides for losses associated with this additional level in the supply chain when the loss event is a covered peril, which may include earthquake and/or flood if coverage for such perils is endorsed to or otherwise made a part of the policy.
“With business success often riding on the strength of the supply chain, the new coverage option will give insurers the ability to provide a more robust supply chain coverage solution to commercial policyholders,” added Thompson.
The ISO filing has a planned April 2013 effective date for commercial property, capital assets (output policy), and agricultural capital assets and will be introduced for the businessowners program later in 2013.
Since 1971, ISO has been a leading source of information about property/casualty insurance risk. For a broad spectrum of commercial and personal lines of insurance, the company provides statistical, actuarial underwriting, and claims information; policy language; information about specific locations; fraud identification tools; and technical services. ISO serves insurers, reinsurers, agents and brokers, insurance regulators, risk managers, and other participants in the property/casualty insurance marketplace. ISO is a member of the Verisk Insurance Solutions group at Verisk Analytics (Nasdaq:VRSK). For more information, visit www.iso.com and www.verisk.com.