Business Interruption Insurance Coverage: The Next Century - Pasich LLP
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
UNITED STATES: Update on Proposed COVID-19 Insurance Coverage Legislation and Litigation:
Are Cooler Heads Beginning to Prevail? Page 12
Demystifying Cyber Threats Page 13
COVID-19 and Workers’ Compensation Page 14
Is the Insurance Office Going Away for Good? Page 15
Covering the world of insurance since 1966.
International. Independent. Innovative.
The cure for news overload.
Business Interruption
Insurance Coverage:
The Next Century
~ by Annette Hofmann and
Meyer Mandel Page 11
JUNE 2020 • ISSN #2165-2740 • VOL. 23 NO 6 • IRLETTER.COM
2 EDITORIAL
Editor’s Letter
Clash of culture in me. I have seen many firms over we played rugby in the winter
my decades as a business writer and athletics in the summer – all
In these crazy stay-at-home
that have boasted of having a sponsored by the firm. Bridge clubs
times more than just a few are
strong corporate culture. Too often abounded and from time to time
talking about how COVID-19
it means a culture where confor- they held a whist drive. We had
might affect corporate cultures.
mity to centrally dictated norms French-speakers’ soirées and large
For a number of years at Aon I pervades the firm with individuali- receptions when senior officers of
was involved with the integrating ty and genuine innovation taking a the company retired.
of acquired companies mostly out- backseat. True, this sort of approach was
side of the US. Corporate culture,
Firms that fail often exhibit more frequent for the larger corpo-
such as it was, didn’t figure into
strong corporate cultures, many rations; smaller organisations could
the equation to the extent that it
built round the ego of one man: not afford that but were more
did in my earlier years with Rollins
just think of Independent Insur- tightly knit as a result of their size.
Burdick Hunter Co. Even before
ance and Mike Bright here in the Even before the lockdown
Pat Ryan acquired RBH there was
UK, or the media empire owned precipitated by Covid-19 many
A.B. Hodges a distinct culture – we knew who
by Robert Maxwell. If you have an of these old ways of working had
Editor in Chief we were and mutual respect was a
inclusive, supportive and innovative changed, but the point is there
way of life. After the acquisition,
irl@irletter.com
corporate culture you don’t need were ample opportunities to get to
Pat took extreme care to look
Follow us: to shout about it from the rooftops. know your fellow employees well
after all the people that made the
Everyone can see it and people enough that when you needed a
Twitter @isninsurance business a success. Times changed
who work in those firms are quietly favour, or had to go the extra mile,
and corporate culture became a
LinkedIn loyal and proud to work there, that seemed smoother because
buzzword thrown around by those
Insurance Research Letter making them its best advocates. your colleagues were part of your
who stood to make some money by
Lake Forest, Illinois 60045 making the term a cornerstone of daily life and not a faceless cog in a
USA their engagement. Adapting your machine.
+1 (312) 287-6021 Today it’s mostly small compa- corporate culture During the last couple of
nies with dedicated owners that months people have started to get
Subscribers to the Insurance Research By George Worsley
serve up corporate culture. There used to working from home – and
Letter (IRL) are entitled to receive There are more than ten dif-
are some exceptions: Uline, a some haven’t – but it is true to say
further free consultation on ferent definitions of culture in my
large family-owned business, is the that corporate culture will change
material published. dictionary but what we are looking
leading distributor of shipping, when many colleagues do not see
Add the Insurance Research at here is the way in which all em- each other on a regular basis. The
industrial and packaging materials
Letter to your Vertafore ployees act together, react to each interaction of colleagues – and the
to businesses throughout North
ReferenceConnect library. other, cooperate and motivate each management and supervision of
America. Liz Uihlein, the President
other in the working environment. them – is going to be different.
& founder, dishes up corporate
culture every day and with her Environments can differ accord- In order to get the best out of
Would you like to be “letters” in each catalogue. Read ing to the nature of a corporation’s everyone, corporations need to
published? one here size and activities. Also there can work out how to do that. Perhaps,
If you would like to submit an be differences in corporate culture if it has not yet already been
But for the most part, corporate
article for consideration, send us an depending on the global location: mooted, the creation of a CCO
culture is cooked up by consultants
email irl@irletter.com. Spaniards do things differently (Chief Culture Officer) role will be
and public relations departments
from Canadians. necessary to look at how the spirit
and mostly for external consump-
IRL Blog tion. Just my opinion so I asked two A lot may change, however, of togetherness (which underlines
Stay blog-tuned trusted wise friends what ‘corpo- wherever the corporation is located people’s willingness to go the extra
@ https://irletter.com/blog/ rate culture’ meant to them. Here’s or what it does, once working from mile) can be created without the
what they had to say: home (WFH) or remotely becomes employees actually being togeth-
permanent. er.” •
Here comes the cynic When I started working for a
large insurance carrier in the City Highlights
By David Worsfold of London, we had a large canteen
The phrase ‘corporate culture’ (free lunches – especially the Is a Risk-free Economic
has always bugged me. Today Christmas bonanza with roast tur- Recovery Feasible?
with many working from home or key and you were allowed to bring Sure—It just requires a balance
remotely journalists who write for a moderate amounts of wine with between NECESSITY, DUTY
living but mostly have no business you), a Charlady with her trolley and POWER – read our Peruvian
acumen are searching for subjects bringing us coffee in the morning correspondent’s take on this on
to unpack for their audience. and tea in the afternoon. The page 10
Forgive me but the phrase “cor- company had a large sportsground Business Interruption
porate culture” bring out the cynic in the outskirts of London where
1 IRMI, “War Exclusion,” available online at: https://www.irmi.com/term/insurance-
INSURANCE RESEARCH LETTER • June 2020 definitions/war-exclusion.
EDITORIAL 3
Insurance Coverage: The
Next Century
discussed following 9/11 and the
issue again returned to promi-
traditional insurance office on
page 15 Table of Contents
“Consequential Coverage”, nence following 2018 litigation page 6
in relation to losses suffered as Latvia: FCMC might be
also better known as Business morphed into a Central
Interruption (BI) or Contingent a result of the malware known Synopsis
as NotPetya. Putting aside the Bank division NewsBriefs & People
Business Interruption (CBI) cov-
“war” exclusion, for which much In many countries Central
erage, has originated and there-
fore resided over time within the ink has been spilled, this article Banks play a pivotal role in over- page 7
seeks to demystify the terminol- seeing and regulation the insur-
greater property insurance cov-
ance industry. At the end of May
ABC Review–Agent, Broker,
erage area. Other policy types ogy in relation to cyber threats Consultant News
and cyber crime. Read this 2020, the Ministry of Finance
and forms have also been known NewsBriefs & People
interesting article on page 13 (MoF) from Latvia submitted
at times to offer coverage for
to the Cabinet of Ministers an
what essentially became known COVID-19 and Workers’ page 8
assessment prepared in co-op-
as “loss of income” coverage. Compensation
The current global pandemic
eration with the Central Bank Recently Published
While most press reports, pub- of Latvia and the Financial and
highlights the obvious need to Global Briefs
lic policy debates and lawsuits Capital Market Commission
further develop consequential Market briefs by country
have centered on business inter- (FCMC) regarding a possible
loss of income insurance that
ruption insurance, state workers’ merge between the Central Bank
applies to a wider spectrum of
compensation systems and the and FCMC, planned to start in
page 10
potential loss scenarios. There
seems a growing need to achieve
insurance products underlying 2022 - 2023. Page 16 Americas
them have been adjusting to the Peru
true business resilience with
COVID-19 crisis. Read about Romania: COVID-19
determined risk management pandemic changes Is a Risk-free Economic Recovery Feasible?
the most significant develop-
standards that commercial enter-
ments with respect to: population’s perception United States
prises are dependent on. Read of risks, reduces Business Interruption Insurance Coverage: The
more on page 11 • Compensability of revenues, and changes Next Century
COVID-19 related claims consumer behavior
Update on Proposed under state workers compen- Update on Proposed COVID-19 Insurance
COVID-19 Insurance Following the reduced Coverage Legislation and Litigation: Are Cooler
sation schemes; and
Coverage Legislation and incomes and the changes on Heads Beginning to Prevail?
• The calculation of workers’ the employment segment, the
Litigation: Are Cooler compensation insurance pre- COVID-19 pandemic also pro- Demystifying Cyber Threats
Heads Beginning to miums.
Prevail? duced changes in Romanians’ COVID-19 and Workers’ Compensation
on page 14 perception of risks and con-
In the wake of government 2020’s Atlantic Hurricane Season to Have ‘Well
sumption behavior, according to
quarantine/shut down orders 2020’s Atlantic Hurricane the latest UNSAR-IRES Barom- Above-Average’ Activity
being executed in response to Season to Have ‘Well eter. There are some surprising Is the Insurance Office Going Away for Good?
the pandemic, a flurry of bills Above-Average’ Activity statistics on page 16
were introduced in several states An updated 2020 hurricane page 16
to retroactively create—by gov- season forecast released by the Hong Kong: Insurance
ernment fiat—business interrup- Tropical Meteorology Project Authority releases Europe
tion insurance under property in the Department of Atmo- provisional statistics of Latvia
insurance policies where none spheric Science at Colorado Hong Kong insurance FCMC might be morphed into a Central Bank
had existed. Some of those bills State University (CSU) calls for industry in the first division
remain pending, while others a “well above-average” level of quarter of 2020
have now been tabled. Learn Romania
tropical cyclone activity. Read on The Insurance Authority just COVID-19 pandemic changes population’s
what legislation and litigation page 14 released provisional statistics
is going on in various states on perception of risks, reduces revenues, and changes
of the Hong Kong insurance consumer behavior
page 12 Is the Insurance Office industry for the first quarter of
Going Away for Good? 2020, indicating a growth of
Demystifying Cyber The coronavirus pandemic is page 17
Threats total gross premiums by 10.9
already changing the way that percent to $165 billion over the Asia & Oceania
Insurance policies often American businesses operate, corresponding period in 2019. Hong Kong
contain provisions, which can at least temporarily. But look Page 17 Insurance Authority releases provisional statistics
differ significantly in how they closely and you can see the of Hong Kong insurance industry in Q1 2020
are worded, that purport to limit potential for long-lasting changes
coverage for losses arising out of even after life returns to normal. page 18
war or warlike actions.1 These Read why one of these shifts
so-called “war” exclusions were might just mean the end of the The Back Page
Quotes
INSURANCE RESEARCH LETTER ADVERTISERS Of Interest
ISSN #0892-0540 Vol. 54 No. 5 IRMI Captive.com
ISSN #2165-2740 Vol. 23 No. 5 (digital) unisonSteadfast
EDITOR-IN-CHIEF A. B. Hodges
GRAPHIC DESIGN Turcotte O’Keeffe, Inc.
INSURANCE RESEARCH LETTER • June 2020
4 NEWS Contributors
Idan Cabello Antonio Attías Judith A. Selby
Is a Risk-free Economic Is a Risk-free Economic Update on Proposed
Recovery feasible Recovery feasible? COVID-19 Insurance
Page 10 Page 10 Coverage Legislation and
Idan has been Risk Antonio is a civil Litigation: Are Cooler
Prevention Manager at engineer (Hydrology) Heads Beginning to Prevail
CONTACTO (#1 local with more than 40 Page 12
insurance broker in Peru) years of experience as a Judy is a Partner at
since September 2013. He has more than 11 years consultant at corporate level in leadership and risk Hinshaw in New
of experience in the insurance market and industry, management in oil, petrochemical, industrial and York City. For more than 25 years, Judy Selby has
both locally and internationally. Prior to CONTAC- mining companies. He worked for more than 25 served as a trusted advisor to insurers across a
TO, Idan was Risk Engineer at REHDER (#1 local years in the corporate world in oil companies such wide variety of industries. Focused primarily on
insurance broker until it was acquired by MARSH in as Lagoven SA, PDVSA, Ameriven (Joint Venture insurance coverage matters, Judy represents clients
June 2013). Over the course of 3 years in Europe, he Conoco-Chevron-PDVSA), and as advisor, among in all phases of large scale, complex first and third
held safety engineer positions in LOUIS VUITTON others in Venezuela, and SURATEP (Insurance) in party insurance issues. She has extensive experience
and MICHELIN. Idan also worked in GLENCORE Colombia, HYLSA (Steel production) in Mexico, handling insurance coverage trials in the U.S. and
and MAPFRE and is a qualified engineer with a and in the last 10 years for different companies international arbitrations in London. Judy also
deep understanding of the Peruvian insurance mar- dedicated to fishing, insurance, steel, industrial and helps clients navigate insurance due diligence in
ket. Idan is result-oriented with a proven track record mining in Peru, mainly in the area of leadership connection with mergers and acquisitions, as well as
for leading a dynamic team of professionals which development and risk assessment. Antonio has a run off and adverse development cover transac-
has allowed to develop the unique value offer in Peru deep understanding of leadership development tions. In recent years, Judy has also expanded her
that integrates risk engineering with occupational strategies, mentoring and coaching, and that is why practice to accommodate emerging technology risk,
health and wellness in order to provide accurate he has been selected as a speaker for several Safety, by focusing on matters involving cyber and data
information to business owners. He earned a Master Health, Risk Management Congresses in LATAM privacy. Operating at the intersection of cyberse-
Degree in Risk Management (France). Idan is also and as a professor for graduate courses in Leadership curity and insurance coverage, she has counseled
Monthly contributor at Insurance Research Letter for some LATAM universities. At the moment, he clients on cyber policy adoption, and also provided
LATAM and mentor in StartUp UNI (technolo- works as a teacher for the ESAN School of Business compliance advice regarding privacy and cyberse-
gy-based business incubator). in Lima and Academic Director of QUALICON curity laws and regulations.
LinkedIn: LATAM (Development of Educational Virtual Email: JSelby@hinshawlaw.com
https://www.linkedin.com/in/idancabello/ Programs). He obtained a Magister Scientiarium in Tel: +1 (212) 471-6209
Engineering and Planning (1984, USB-Venezuela)
Tel: + 51 998 503550 and a Master’s Degree in Environment (School of Full bio HERE (secure)
Civil Engineering) with all the subjects required for
Scott M. Seaman Risk Management (School of Nuclear Engineering) Peter A. Halprin
Update on Proposed (1998, TEXAS A&M, USA). Demystifying Cyber Threats
COVID-19 Insurance Cov- Page 13
erage Legislation and Lit- LinkedIn:
https://www.linkedin.com/in/antonioattias/ Peter is a partner in
igation: Are Cooler Heads Pasich LLP’s New York
Beginning to Prevail? Tel: + 51 922 678653 office. Peter represents
Page 12 commercial policy-
Scott is a Partner at Daniel B. Garrie, Esq. holders in complex in-
Hinshaw in Chicago. Scott Seaman is Co-Chair of Demystifying Cyber Threats surance coverage matters with a focus on recovery
the firm’s global Insurance Services Practice Group. Page 13 strategies in relation to cyber crime, natural disas-
The group is ranked in Chambers USA: America’s Daniel is a seasoned ters, professional services, regulatory investigations,
Leading Lawyers for Business, Insurance: Dispute e-discovery special and technology disputes. Over the course of his
Resolution Illinois and earned a National Tier 1 master, forensic neutral, career, Peter has arbitrated, litigated, and mediated
rating in the Best Law Firms list published by U.S. mediator, and arbitrator claims involving a broad range of insurance policies
News – Best Lawyers as well as Tier 1 regional retained for complex, and recovered hundreds of millions of dollars in
ratings in Chicago, Los Angeles, and Miami. high-stakes cases around the country. He is an insurance proceeds for policyholders. Peter has
As a commercial litigator and trial lawyer with experienced jurist with a deep understanding of both advised clients regarding insurance coverage under
more than 32 years of experience, Mr. Seaman has law and technology, enabling him to efficiently and an array of forms and policies including Boiler &
had the privilege of working with some of the most cost effectively resolve some of the most challenging Machinery, Builder’s Risk, Commercial Crime,
dedicated and talented senior management, legal disputes. For over a decade, Mr. Garrie has served as Cyber, Directors & Officers (D&O), Employment
counsel, and insurance and reinsurance claims and a mediator, arbitrator, electronically stored informa- Practices Liability (EPL), Errors & Omissions
litigation professionals in the world and of serving tion (ESI) liaison, discovery referee, special master, (E&O), Fidelity, General Liability (GL), Kidnap &
as counsel in precedent setting cases involving some neutral, and neutral expert. He has appeared before Ransom (KKR), Media Liability, Pollution Legal
of the most challenging contemporary coverage the Los Angeles County Superior Court, New York Liability (PLL/EIL), Products Liability, Property,
and reinsurance issues confronting the insurance Supreme Court, Delaware Supreme Court, and the Technology E&O, Trade Credit, and Workers’
industry. U.S. Courts of Appeals for the Second, Third, and Compensation.
Seventh Circuits. Email: PHalprin@PasichLLP.com
Email: sseaman@hinshawlaw.com
Tel: +1 (312) 704-3699 Email: Daniel@lawandforensics.com Tel: +1 (646) 974-6470.
Tel: +1 (206) 228-5457 Full bio HERE (secure)
Full bio HERE (secure)
INSURANCE RESEARCH LETTER • June 2020
Contributors NEWS 5
George Worsley David Worsfold Annette Hofmann
Adapting your Here comes the cynic Business Interruption
corporate culture Page 2 Insurance Coverage:
Page 2 David has 30 years The Next Century
George has been experience as a jour- Page 11
involved in the inter- nalist, mainly covering Annette is MetLife
national insurance the insurance industry, Associate Professor
industry for more than financial services and of Risk Management
35 years. Having worked with Commercial Union politics but also writing on a wide range of other and Insurance; Director of the Risk Management
(now Aviva), Delta Lloyd, Bekouw Mendes and subjects. In addition, he has a broad experience of and Risk Analytics Program (M.S.); Maurice R.
Alexander & Alexander (now Aon), The St Paul editorial management in large and small publishing Greenberg School of Risk Management, Insurance
Companies (now Travelers) and WBN, he currently companies, launching and re-launching publications, and Actuarial Science; Peter J. Tobin College of
runs his own firm, Worldwide Risk Solutions. He and brand development through the launch of Business, St. John’s University. In Annette’s words
has vast experience in working in different cultural conferences, awards and websites and of overseeing “I have previously held business school faculty
and business environments, speaks several languages production and design services. David has exten- appointments at two other universities: Hamburg
and is widely travelled. He has lived in New Zealand, sive experience of re-aligning content creation and School of Business Administration (HSBA) and
Belgium, the Netherlands, USA and now England. delivery for the modern, multi-platform, mobile the University of Hamburg (Hamburg Business
He has in-depth knowledge of the global insurance world, especially working with publishing teams that School) in Germany. At St. John’s, I teach courses
industry. With effect from 2006 he has been advising need to move from a print-centric environment to in risk management, insurance, econometrics, and
individuals and firms around the world and facili- the web first world of today. A key part of this was financial mathematics. My research involves the
tating global business strategies and international developing effective strategies for delivering content application of microeconomics and data science
business development. This involves intensive con- through Apps. This includes a wide knowledge and techniques to the analysis of interdependent risk
tacts with retail, wholesale and reinsurance brokers understanding of the role social media plays in mod- networks, decision-making under risk, prevention
and agencies, access to training, skills and expertise ern media. He was also responsible for developing decisions, insurance markets, health care markets,
in handling insurance and risk management projects video and audio content for Incisive Media’s websites and industrial organization. With over 15 years of
in many countries. George was closely involved through two top quality in-house studios. research and teaching experience in the field of risk
with structuring networks such as Brokers Link, has Email: david@worsfoldmedia.com and insurance economics, I have an extensive aca-
completed projects with Assurex, HLA (now Wells demic background with more than 35 publications
Fargo), UNiBA, UNISONBrokers and WING, to Meyer Mandel in this field as well as over 10 years of experience
name a few. He advises many firms on a one off Business Interruption as an active faculty member at 3 different Business
basis and remains on the contact list of brokers in Insurance Coverage: Schools after completion of my Ph.D. in Germany.
more than 100 countries around the world. George The Next Century This includes working as an Assistant Professor
is married and has three children. He is an ardent Page 11 and Stand-in Chair for 4 years at the University of
sports fan, loves cooking, gardening, reading, history Hamburg (German research excellence university)
and listening to music. Meyer is the Founder and 5 years in the U.S., plus 2 years as a Full Profes-
and President of M sor at another business school helped me to develop
Email: george.worsley@worldwiderisksolutions.com Squared Advisory, my skills as a researcher and instructor.”
Tel: +44 7968 191511 focusing on risk consulting and mentoring Insurtech
startups. Meyer has over twenty years experience Email: hofmanna@stjohns.edu
Duke Williams within the (re)insurance industry, starting at Willis Tel: +1 (212) 277-5144
Is the Insurance Office followed by TransRe underwriting specialty property
Going Away for Good? before spending 15 years with catastrophe modeling Jason Schupp
Page 15 firms CoreLogic (EQECAT) and RMS. During that COVID-19 and Workers’
time, Meyer worked with the global industry on in- Compensation
Duke is founder Page 14
of Simply Easier tegrating data and analytics for transferring, trading,
Payments, a leading underwriting, aggregating, and managing risks. Mey- Jason is the founder
no-cost total payment er became proficient with contingent risks after Hur- and managing member
solution partner for insurance and other industries ricane Katrina and started working on the concept of the Centers for
accepting mobile or online payments. Providing a of Supply Chain Comprehensive Business Interrup- Better Insurance. CBI
one-stop credit card payment processing solution tion Insurance (SCCBII). He joined AIG thereafter is an independent organization making available
designed especially for insurance agencies, brokers to head their Supply Chain Risk practice. During unbiased analysis and insights about key regulato-
and carriers, it offers a hassle-free experience that time, Meyer expanded his understanding of all ry issues facing the industry for use by insurance
without the high fees other providers charge, and different risks that can impact supply and demand professionals, regulators and policymakers.
it’s 100 percent compliant in all 50 states in the U.S. chains, including cyber, trade credit, political, cargo Email: jason.schupp@betterins.org
Since 1996, Simply Easier Payments has provided and intermodal logistics risks. He has developed an Tel: +1 (240) 357-8914
secure, compliant and reliable payment solutions E2T2 model to contingency risk expectations. Meyer
to thousands of businesses around the nation with was a trustee scholar and graduate of the Greenberg
reliability and affordability being the cornerstone School of Risk Management & Insurance at St.
principles for delivering real, working solutions to John’s University’s Tobin College of Business, and
its customers. To learn more, visit: https://www. currently serves on their alumni board. He is also a
simplyeasier.com. member of the Risk and Insurance Council of the
American Management Association. He has present-
Email: duke@simplyeasier.com. ed to global regulators, analysts and participated in
numerous industry round table discussions.
Email: meyer@sccbii.com
Tel: +1 (201) 245-6383
INSURANCE RESEARCH LETTER • June 20206 NEWS Synopsis
Synopsis
others in the form of webinars or platform.
virtual events later this year. IMAC
asks speakers to continue sending Ironshore Environmental
Volume 31, Number 6, June presentations these in if you are Offers New
2020 willing to deliver these as webinars Contractors’ COVID-19
or virtual events - which provide Remediation Endorsement
Companies greater opportunity for Q&A. Visit Ironshore Environmental is now
SEC fines insurer Argo for IMAC’s Call for Speakers web-page offering a COVID-19 endorsement
failing to disclose $5.3M in at: https://caymanintinsurance.ky/ that can be added to its Contrac-
perks paid to former-CEO speakers-2/ and read the import- tors’ Environmental Legal Liability
Watson ant information carefully, which (CELL) policy for certain contractor
includes feedback from our Forum classes, effective immediately. Iron-
Securities regulators levied a
2019 on topics of interest and the shore’s CELL coverage responds to Michelle
$900,000 fine against specialty
web-link where you will submit all third-party bodily injury, property McLaughlin
insurer Argo Group International
your speaker proposals. Presenta- damage and remediation of envi-
Holdings for failing to disclose
tion panels should be comprised of ronmental damages resulting from
about $5.3 million in perks awarded
2 or 3 speakers and include at least pollution incidents caused by the
to former CEO and President Mark
one Cayman captive owner/risk contractor’s work at a job site. Iron-
E. Watson III.
manager. Upon acceptance IMAC shore’s new COVID-19 coverage
Berkshire Hathaway dumps will forward a copy of the speak- is specifically designed for experi-
its’ remaining stake in er guidelines which will include enced environmental and disinfec-
Travelers important information and the tion contractors. The COVID-19
Warren Buffett’s Berkshire Ha- date they need to receive your final remediation endorsement is being
thaway sold its remaining stake in presentation. The final speaker se- offered on a claims-made, prac-
The Travelers Companies (Travel- lection and agenda is expected to be tice or project-specific basis with
ers), a financial filing released by the available in September 2020. If you available limits of up to $5 million.
Security and Exchange Commis- have any questions or suggestions, COVID-19 remediation coverage is Marc Lipman
sion (SEC) on May 15 revealed. please email William Forsythe, available with a minimum premi-
The investments were worth about General Manager, IMAC Insurance um of $25,000 with a minimum
$43 million on December 31. Managers Association of Cayman deductible of $50,000.
@ william.forsythe@caymancap- Skuld agrees sale of
Brit & Google Cloud launch tive.ky
first algorithmically driven Lloyd’s Syndicate 1897 to
Lloyd’s Syndicate, Ki Hippo Acquires Spinnaker RiverStone –
Specialty insurer and reinsurer Insurance Company Norwegian marine insurer Skuld
Brit has collaborated with Google Licensed Insurance Carrier Will has reached an agreement with leg-
Cloud to launch Ki, a fully digital Become Part of Hippo’s Family of acy provider RiverStone for the sale
and algorithmically-driven Lloyd’s Companies. Hippo, the high-growth of Skuld Lloyd’s Syndicate 1897,
of London syndicate designed to company that’s transforming which was placed into run-off in
redefine the commercial insurance home insurance and ownership, July 2019. The transaction is subject
market as a ‘follow-only’ syndicate. announced that it has entered into to regulatory approval. Read more
Thaddeus Woosley
The new standalone business is a definitive agreement, pending
expected to launch in 2021, and the regulatory approval, to acquire People
pair state that its creation marks a Spinnaker Insurance Com- claims functions. Based in New
Kang Joins Allianz From
step change for an industry yet to pany, a national property and York, he will report to Paul Schia-
Willis Towers Watson
face the disruption seen across other casualty insurer licensed in 50 vone, North America regional head
to Head Cyber in North
financial services and industries. Ki, states and rated A- (Excellent) by of Financial Lines, North America
America
the Lloyd’s market’s first fully digital A.M. Best Company. As part of the and regional head of Corporate
Allianz Global Corporate & Long Tail Lines and ART.
and algorithmically-driven syndi- acquisition, Spinnaker will join Hip- Specialty (AGCS) announced that
cate, will be accessible anywhere, po’s family of companies. Hippo Thomas Kang is joining the Chubb Appoints Chief
anytime, and aims to dramatically Insurance will continue to operate insurer as head of Cyber in North Underwriting Officer of
reduce the amount of time and as a managing general agent with America. Kang, an attorney, joins its North America Middle
effort it takes for brokers to place a portion of its premiums to be un- AGCS from Willis Towers Wat- Market and Small Business
their follow capacity. It’s expected derwritten by its affiliate Spinnaker son, where he served as Global Insurance Divisions
that this will help to drive greater and the balance underwritten by Cyber Product leader since 2018. Chubb has appointed Michelle
efficiency, responsiveness and com- other carrier partners. Spinnaker During this time, he formulated McLaughlin Chief Underwriting
petitiveness. will operate independently under cyber product strategy across both Officer of its North America retail
the Hippo umbrella and main- traditional and specialty lines of
Cayman Captive Forum tain its position as a best-in-class
commercial property and casual-
Cancelled business. Earlier in his career, Kang ty insurance division that serves
program and fronting company. was with The Hartford, as led and
Insurance Managers Associa- middle market and small businesses
Spinnaker will continue to service a product manager for Cyber, Tech
tion of Cayman made the difficult through 48 offices in the United
diverse portfolio of top-quality pro- and Professional Liability insurance.
decision not to hold the Forum for States and Canada. In this capacity,
gram administrators and drive the He also spent three years at ACE
2020. IMAC is working to provide Ms. McLaughlin will guide the busi-
growth of its value-added program Group in senior cyber service and
content to IMAC members and ness lines’ underwriting strategies
INSURANCE RESEARCH LETTER • June 2020 Synopsis, Continued on page 17ABC Review–Agent, Broker, Consultant News NEWS 7
ABC Review and automation software America. Led by Oliver Marx, the
provider business prides itself on the close re-
Marsh & McLennan Compa- lationships that they provide to risk
Aon to lead restart effort in buyers and risk sellers, and the abili-
nies, Inc.’s Oliver Wyman recently
Chicago ty to offer buyers customized service
acquired a minority stake in Cor-
Going back to work won’t be ridor Platforms, which is a leading and a global trading re-insurance
business as usual. A group of Chi- decision workflow governance and and insurance market in which to
cago companies is creating a play- automation software provider. In find cover. The five-strong team has
book to restart Chicago’s economy. July 2019, Oliver Wyman entered over 50 years of combined experi-
Aon is leading a coalition of major into a strategic partnership with ence between them and will remain
Chicago corporations to draw up Corridor Platforms to offer banks within the business following com-
safe standards for restarting the and non-bank financial institutions pletion of the deal. Earlier this year,
economy from the coronavirus solutions and help update and PIB also announced the acquisition Steve Petrevski
pandemic, creating a model that digitize credit extension, transac- of the employee benefits division
the consulting and risk manage- tions and end-to-end risk manage- of Sanlam Wealth Planning UK,
ment giant plans to expand to cities ment. This tie-up allowed Corridor and more recently BK Insurance
throughout the world. Read more Platforms’ unique, modular and Brokers and RA Insurance Brokers.
cloud-based risk management plat- In total, the Group has made 29
Arthur J. Gallagher & Co.
form that assists in credit modeling, acquisitions since December 2015
Acquires CRES Insurance
loan valuation and real-time policy with support by an investment
Services,
execution to combine with Oliver from the Carlyle Group, one of the
Arthur J. Gallagher & Co. world’s largest and most diversified
Wyman’s competence in risk man-
announced the acquisition of Las global investment firms, with $217
agement, such as next-generation
Vegas, Nevada-based CRES billion of assets under management
risk analytics, model development
Insurance Services, LLC. Founded across four core business segments
and data or process management.
in 1996, CRES designs, markets and 392 investment vehicles.
Oliver Wyman utilized Corridor
and services comprehensive errors Andy Barrengos
Platforms’ solution to enable timely Nexus broking division
& omissions insurance and risk
end-to-end credit decision making acquires trade credit
management services to real estate
while enhancing governance. With business from Howden UK
firms and professionals across the
Corridor Platforms, the process of
United States, particularly in the Insurance intermediary holding
big data and analytics can be con-
Southwest. The CRES team will company, Nexus Group announced
densed to a few weeks from months.
continue to operate from their cur- its independent broking arm Xenia
This strategic initiative is the right
rent locations in Las Vegas and San Broking Group acquired the trade
move during these challenging
Diego under the direction of Kevin credit business of Howden UK.
times as demand for fast credit
Garvin, head of Gallagher’s North Xenia will integrate Howden’s trade
models and decisioning is at its
American Affinity operations. credit business with its regulated en-
peak. Notably, Corridor Platforms
tity Credit Risk Solutions Limited.
Higginbotham Grows will be able to gain traction from
San Antonio Practice Oliver Wyman’s experience in the Willis Towers Watson to sell
with Amerman Insurance forefront of risk management and Max Matthiessen
Services Merge advanced analytics. The deal was Willis Towers Watson is selling its Stan Loar
Higginbotham and Amerman struck at a time when the market is Swedish insurer Max Matthiessen
Insurance Services, an independent quite volatile with insurers facing
high claims and new threats in the
to private equity firm Nordic Cap- People
broker in San Antonio, Texas, have ital, in a bid to scale up the compa-
merged operations. The union adds wake of the coronavirus outbreak. ny’s operations, product innovation Aon appoints new data &
eight commercial and personal and accelerate its organic as well analytic services leader
Munich based Marx Re-
property/casualty insurance and as acquisitive growth. The Swedish Aon has promoted Steve Pe-
Insurance Brokers is
employee benefit professionals firm is said to be among the top trevski as senior vice president and
acquired by PIB Group
to Higginbotham’s existing local financial advisors within pensions, general manager of data & analytic
practice for a combined 38-person PIB Group Limited (PIB) has ac- services.
insurance, and investment in the
group. Higginbotham’s San Anto- quired Marx Re-Insurance Bro-
Nordic region. Established in 1889,
nio office will partner with Amer- kers, based in Munich, Germany. Howden entices two from
Max Matthiessen has been engaged
man Insurance to bring its single The move reflects PIB’s ongoing Aon
in offering occupational pensions,
source solution for insurance and ambition of international expansion The CEO of Aon EMEA Spe-
asset management, and non-life
financial services to area businesses. and widens the Group’s proposition cialty Luigi Sturani and Chief
insurance products. The company
The partnership is part of Higgin- into providing reinsurance solutions. Commercial Officer, Aon EMEA
has 440 full-time employees. Max
botham’s growth strategy that sees Founded in 2009, Marx Re is a Specialty Enrico Nanni have
Matthiessen has nearly 30 locations
it merging with other independent reinsurance and insurance broking resigned from the global broker and
across Sweden and reportedly has
brokers that expand its capability company with a global network will join Howden Broking Group
around 13,000 corporate clients.
to support a mounting number of of clients. It has a major focus on
Last year, the company had reve- Woodruff Sawyer
clients seeking all-inclusive services. asset-based business, primarily in
nues of SEK1.55 billion (€148m). announces leadership
property and construction, power
In 2014, Willis acquired a stake of changes
Marsh unit buys decision generation and renewable energy
about 75 percent in Max Matthies-
workflow governance sourced from Europe and Latin Woodruff Sawyer announced
sen for $205 million. Andy Barrengos, Woodruff Saw-
ABC Review, Continued on page 188 NEWS Recently Published • Global Briefs
Recently Published Global Briefs
Aon Research Details Volume of China – China Pacific Insurance • Trade credit insurance coverage to be
Representations and Warranties gets green light for London listing maintained across the market in light
Insurance Claims China Pacific Insurance Group has of COVID-19, with up to £10 billion
Aon has released the “Representations and Warranties received regulatory approval to issue government backing
Insurance Claim Study: An analysis of claim trends, data, and 125.73m global depository receipts (GDRs), • Measures will support thousands of
recoveries” analyzing data it has collected with respect which will be listed on the London Stock businesses by protecting against customer
to nearly 2,500 representations and warranties (R&W) Exchange. The green light was granted by defaults or payment delays
insurance policies placed by Aon in North America, the China Securities Regulatory Commis- • Scheme is available on a temporary basis
as well as approximately 340 claims made on those sion. Swiss Re has agreed to be a corner- for nine months, backdated to 1 April
policies during the same period. The report’s findings stone investor by subscribing to a stake of 2020, and available insurers operating in
show that a consistent percentage of insured deals over up to 1.5 percent, China Pacific said. The the UK market
the study’s four-year period resulted in a R&W insur- Swiss insurer will be subject to a three-year
ance claim and significant claim payments were made: lock-up. The listing of the GDRS is under Note to Readers:
• On average across the study period, claims were a stock exchange cooperation scheme, • Trade Credit Insurance underwrites
filed on approximately one out of every five R&W known as the Shanghai-London Stock Con- an estimated £350 billion of economic
policies. nect scheme. The GDRs represent about 10 activity of more than 630,000 businesses
percent of the insurer’s A shares traded on in the UK each year. It insures suppliers
• Aon clients received more than $350 million in
the Shanghai stock exchange, China Pacific selling goods against the company they
claim payments above the policy retention.
said. The Shanghai-based insurer is the are selling to defaulting on payment,
• Of the 340 claims: second company to be approved for listing giving businesses the confidence to trade
• 30% of claims were resolved, where insurers either under the so-called Shanghai-London Stock with one another
paid loss to the policyholder or acknowledged loss Connect programme launched in June
• Due to coronavirus and businesses strug-
within the retention; 2019. Brokerage Huatai Securities is its first
gling to pay bills, there is a risk of credit
• 54% remain active; 12% are inactive; and and only listing to date
insurance being withdrawn or premiums
• 4% were denied. Hong Kong – Insurance Authority increasing to unaffordable levels, which
warns against fraudulent website could cause serious issues for liquidity and
Busy Atlantic hurricane season predicted working capital across business supply
for 2020 The Insurance Authority (IA) today (19
May 2020) alerted the public to a fraudulent chains
Multiple climate factors indicate above-normal
website with the domain name of “http:// • The scheme will be delivered through a
activity is most likely. An above-normal 2020 Atlantic
www.baofengins-hk.com”. The fraudulent reinsurance agreement that is open to
hurricane season is expected, according to forecasters
website purports to be the official website all insurers currently operating in the
with NOAA’s Climate Prediction Center, a division of
of an authorized insurer of Hong Kong, UK market, covering both domestic and
the National Weather Service. The outlook predicts
Paofoong Insurance Company (Hong Kong) overseas trade with payment terms of up
a 60 percent chance of an above-normal season, a
Limited (Paofoong). Paofoong has confirmed to 2 years
30 percent chance of a near-normal season and only
that it has no connection with the fraudulent • The scheme rules will also require partici-
a 10 percent chance of a below-normal season. The
website. The case has been reported to the pating insurers to comply with certain un-
Atlantic hurricane season runs from June 1 through
Hong Kong Police Force for further investi- dertakings regarding the conduct of their
November 30. Read more
gation. Anyone who has provided personal business during the period of the scheme.
IUMI Eye Newsletter June 2020 information to the website or has conducted This includes conditions that insurers will
Read here any insurance transactions through the web- forgo profits and will not pay dividends or
site should contact Paofoong Customer Ser- bonuses for senior staff for their guaran-
Business Insurance’s list of highest paid vices Hotline at 2290-3580, and report the teed Trade Credit Insurance business
insurance executives case to the Hong Kong Police Force. Any
• To protect businesses that the private
Read here company carrying on insurance business
credit market cannot insure, export credit
in or from Hong Kong must be authorized
Zurich: Societal Risks in a Post by the IA under the Insurance Ordinance
insurance is also available from UK Ex-
Covid-19 Era (Cap. 41). The full list of authorized insurers
port Finance to cover UK exports to 180
Increasing inequality, shifting consumer behaviors countries. Government-backed export
in Hong Kong can be found on the Register
and record levels of unemployment mean hard lessons insurance from UKEF can protect the
of Insurers on the IA website.
need to be re-learnt. John Scott, Head of Sustainabil- 230,000 businesses that export from the
ity Risk and Zurich Insurance comments in the WEF United Kingdom – Trade Credit UK against the risk of not getting paid
& Zurich Insurance Covid-19 Risk report: “Increasing Insurance backed by £10 billion when selling internationally
inequality, dramatically shifting consumer behaviors and a lock- guarantee • Implementation of the scheme is subject
down that is having a significant toll on young people’s prospects, • Government to provide guarantees of up to state aid approval, agreement of full
mental health and wellbeing are highly interdependent issues to £10 billion to Trade Credit Insurance form documentation with insurers and
which impact the global economy, geopolitics and our societies schemes for business-to-business transac- acceptance of applications from insurers
in equal measure. On top of this, we are already seeing record tions. for participation •
levels of unemployment due to lockdown measures and are having
to re-learn hard lessons - in particular that social deprivation
determines health outcomes.” •
INSURANCE RESEARCH LETTER • June 2020A service of IRMI®
Sinc
Captive.com is ... e
199
5
• The first and most authoritative online
resource for unbiased information on Editors John Salisbury
the alternative market and John Foehl have
more than 50 years of
• Free access to anyone with no sign-in required combined expertise
in the captive arena.
• Captive thought leader videos
• Designed for tablets and smartphones
• New Learning Center: online CE and CPE credit
About IRMI
IRMI was the first publisher of reference content covering
the field of risk finance in 1983 with the publication of
Risk Financing, a comprehensive reference resource on all
aspects of traditional and alternative market approaches.
IRMI also publishes the first newsletter to cover the field of
captives, Captive Insurance Company Reports, as well as two
comprehensive books on the subject of captive insurance.
Learn more at IRMI.com/Go/Captives.
Contact Monica Sturgeon
for advertising opportunities at
(800) 827–4242, ext. 379, or Monica.S@irmi.com10 NEWS World News: Americas
WORLD NEWS
Americas
a NECESSITY?
PERU For this reason, we state that any preference, understanding, discrepancy
or imbalance between any of these concepts, reduces the sense of responsi-
Is a Risk-free Economic Recovery Feasible? bility and increases the risk that irresponsible behaviors and actions will be
By Antonio Attías and Idan Cabello carried out and even supported and/or allowed.
Sure—It just requires a balance between NECESSITY, DUTY and But what is RESPONSIBILITY?
POWER It is the ability to answer for our rights and duties before others. It is to
The words “NEED”, “CAN” and “HAVE TO” are commonly used on have the power to confront and accept the consequences of our behavior
a daily basis, yet their definitions and differences are sometimes misunder- and actions.
stood. Claiming to be a responsible person or company implies defending our
Understanding each word leads to the decisions that guide the lives of rights and fulfilling our duties in search of balance: “Exerting power to
people and organizations, for example, the responsibility to exist or create meet the needs of society and thus fulfill our duty within the social system
employment. in which we work.” This is our responsibility.
Let’s look at these definitions according to the Spanish dictionary: Applying this definition of responsibility to the current situation in Peru,
• Necesitar (need): From Latin “necessitas,” and this from “necesse” (“in- we see that we have many scenarios worthy of analysis.
evitable,”) the prefix “ne” means “no” and the verb “cedere,” means “to For example, the case of the newly updated At-Risk Population group (*,
stop.” This means “not to stop”—that is to say, something that a person below).
or organization pursues without stopping until it is achieved.
• Deber (have to): From Latin “debere,” and this from “de- GOVERNMENT COMPANY WORKER
hibere” composed of the prefix “de” which means “depri- Revive all the Restart production Maintain my
vation” and the verb “habere” which means “to have.” It is economic activities to comply with creative and
understood then, as the idea of an obligation and commit- gradually to recover workers, suppliers, and productive
I NEED TO and improve the creditors, considering capability, which
ments undertaken. quality of life of that 20% of my payroll involves being in
• Poder (can): from Latin “potere,” and this from “posse,” citizens. is at risk and not good health.
being interpreted as the possibility and therefore being able working.
to do what you set your mind to. Ensure an adequate Maintain the labor Cover the basic
Regarding CAN, meaning to have power to, understood as level of public health rights of the entire needs of my
I HAVE TO and implement payroll, considering family such as
the action that is exerted on human beings by human beings policies to ensure that I only have 80% of food, shelter,
themselves, we consider that the first power concerns oneself, decent employment. the workforce. education, etc.
so in the case of a person, it could be called—if we are allowed
Guarantee the Restart operations Work without
and to simplify such a complex definition—“self-control” and constitutional right safely, make up for lost compromising my
in the case of an organization it can be called “safe produc- CAN I? to work of every time and recover the safety and that of
tion.” citizen. production capacity my colleagues?
that was shut down?
That said, and focusing on companies, some logical ques-
tions arise as follows:
Thoughts as Occupational Health and Safety
Could we call this “safe production” a DUTY beyond professionals:
POWER? 1. We must understand that there are strong preferences at a personal or
Or does that “safe production” go beyond that and become corporate level for any of these concepts, which undoubtedly impact on
INSURANCE RESEARCH LETTER • June 2020Americas NEWS 11
the sense of responsibility and accountability. This implies additional coverage for financial losses to a running business is a lot less popular.
work on our part to always maintain the balance. A recent press release quoting Chubb Ltd’s CEO Evan Greenberg, states
2. We have new challenges in managing the physical and mental health that exposure will come from travel insurance, A&H, Business Interruption,
risks that will emerge from new working environments. Surety, Trade Credit, and Workers Comp. Perhaps even from Errors and
3. It is time to demonstrate our added value, as we could ensure that com- Omissions policies for creating gaps in coverage for not anticipating inter-
panies with creative, innovative, competent, intelligent safety areas are ruption from other known perils and its impact to the entity.
the ones that will manage to stay competitive in the market. We have seen many instances historically where physical loss to a
4. It is worth mentioning that besides what has been analyzed here, “I property was not the sole cause of economic loss destabilizing the finan-
want” appears as a new element within the equation that we must keep cial health of the business’ balance sheet, the global catastrophic nature
in balance, since there are people who do not follow the rules and reg- of the COVID-19 pandemic has highlighted the enterprise risk manage-
ulations, and not because it is necessary, but simply because they “don’t ment (ERM) shortcomings of BI/CBI residing in the traditional property
want to”, as part of a misunderstood exercise of power. policies, and having to find consequential loss coverage that would match
the same terms and conditions from other underwriters in other sectors.
(*) At-Risk Groups: Businesses, large or small, need the “indemnification” provision to maintain
A group of people with individual characteristics associated with a normal operations or financial viability. Relying on BI or CBI coverage is
higher risk of complications from COVID-19. People over 65 years old or prudent risk financing and should never be overlooked in any ERM pro-
who have comorbidities such as: high blood pressure, diabetes mellitus, car- gram. However, it must trigger regardless of the peril, it is very limited in
diovascular diseases, asthma, chronic lung disease, chronic kidney failure, scope and can be irrelevant if it is narrowly included only within the realm
cancer, obesity or other immunosuppressive conditions. of property coverage. When financial disruption occurs due to a cyber
Reference: Ministerial Resolution N° 283 – 2020 – MINSA attack, a political risk crisis, or even a products liability decreasing profits,
there is no less strain on the necessity to maintain financial and operational
stability for the sake of business continuity. A pandemic is just another peril
UNITED STATES in a long list of possibilities which can cause an interruption.
A trail blazing Scottish broker and actuary, Ludovic McLellan Mann,
Business Interruption Insurance Coverage: introduced consequential loss coverage as part of the property policy forms.
The Next Century The immediate need is for a new trail-blazer to expand the claims trigger
of BI and CBI to incorporate multiple perils. Just like a homeowners in-
By Annette Hofmann and Meyer Mandel surance policy became an umbrella for the property and liability coverages
“Consequential Coverage”, also better known as Business Interruption pertaining to personal property in one policy, so too a new “Comprehen-
(BI) or Contingent Business Interruption (CBI) coverage, has originated and sive” BI/CBI umbrella is needed to cover all aspects of Supply & Demand
therefore resided over time within the greater property insurance coverage Chain Insurance.
area. Other policy types and forms have also been known at times to offer Whether BI or CBI loss is caused due to property, marine/inland-ma-
coverage for what essentially became known as “loss of income” coverage. rine/cargo, political risk, trade credit, cyber, products liability, pandemic
The current global pandemic highlights the obvious need to further develop (A&H), or even workers comp (like a NBCR terror attack), submitting the
consequential loss of income insurance that applies to a wider spectrum of same exact risk(s) to all these different underwriting silos is not feasible,
potential loss scenarios. There seems a growing need to achieve true busi- efficient or logical. Every underwriter will have their own wording, terms
ness resilience with determined risk management standards that commer- and conditions for the same risk(s). How does this make any sense for any
cial enterprises are dependent on. Before Covid-19, it was not even part of corporate Risk Manager? Which broker will accumulate all these responses
the debate whether a pandemic would be part o floss-of-income insurance, from all the underwriters and all the carriers they approached and then
even though our new technological realities allow us to respond to this need present to their clients?
of evolving loss potentials.
One can only imagine the conversation between a risk manager and
A day does not go by lately without an article or some other news source their broker or insurance advisor. Carrier A will provide coverage for perils
dedicated to a discussion surrounding insurance industry payouts for A, C, D but not B unless the deductible is excess of a certain amount, while
this new pandemic. These dialogs amongst legislators, attorneys, policy Carrier B will provide consequential loss coverage for B, D, and G and pos-
holders, carriers and just anyone willing to render an opinion or comment sibly A if there was a limit on a specific criteria. A nightmare with a colossal
on whether the Business Interruption coverage is going to be the source headache in the making.
of a claim followed by a payout. Even Christopher Swift, CEO of The
Hartford, revently pointed out that “ever since the pandemic began, some Yet, a solution is most timely and extremely necessary. The president of
plaintiffs’ attorneys have been pushing a false narrative, claiming that … NAMIC, Charles Chamness, recently said, “Pandemics simply are not in-
insurance companies owe money to businesses shuttered by Covid-19 and surable risks; they are too widespread, too severe, and too unpredictable for
we improperly refuse to pay. These lawyers want to turn our customers’ the insurance industry to underwrite”. Is this really the case? An uniden-
carefully protected and managed premiums into an all-purpose rainy-day tifiable risk should not be insurable when it is unquantifiable. Many high
fund, which they were never intended to be. That’s not how insurance severity low frequency events fall into that category have been deemed for
works nor is it a realistic solution to this economic conundrum caused by years to be outside the realm of traditional actuarial principles, lacking the
the shutdowns”. While Mr. Swift is correct, when there are missing parts law of large numbers. If people died because of a pandemic would their
in the insurance coverage provided, this is where the risk management func- life insurance policies not pay out? Is that any less widespread than busi-
tion has fallen short and needs to be addressed. nesses? When SARS and swine flu occurred, model vendors approached
the market with quantifying tools just like is available for other severe and
For consequential losses emanating from the property sector’s BI or CBI unpredictable catastrophic events.
policies, a claim is typically triggered only if there was a physical loss. The
economic loss component covering financial losses to the running business We live in a technology-infused society and capture all forms of data, so
would have to be the result of an insured physical loss incurred to the that creating an umbrella policy for business interruption and even con-
property - whether their own or one of their vendors. While cyber policies tingent business interruption covering supply chain insurance needs to be
and other liability forms might also have provisions for consequential losses, possible simply because it is easily quantifiable. Perhaps requiring different
INSURANCE RESEARCH LETTER • June 2020You can also read
