"the Profitable Potential Of Inland Marine Insurance Sales"
"the Profitable Potential Of Inland Marine Insurance Sales" - Freight and logistics businesses have been hit hard by inflation and supply chain issues over the past few years, causing many to rethink policy restrictions.
The term "supply chain" has become a common phrase since the early days of the pandemic, when people entered stores and found shelves empty of toilet paper, canned goods, and other common household items.
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Delays caused by factors such as China's zero-coronavirus policy leading to the closure of factories and ports, the impact of Russia's attack on Ukraine, and more frequent and severe storms have resulted in large numbers of ships waiting for unloading at sea and in ports.
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Even when products are unloaded from ships, shipments can take weeks to reach their destination due to truck driver and chassis shortages.
"Although delivery times have improved post-SAVID, delays still exist. Ships that would normally take three weeks can now take four weeks or longer," said Karen Zhesutko, senior vice president of marine insurance at Munich Re's specialist insurance group.
All these delays are driving businesses in the world of logistics and commerce to move goods faster and more efficiently. They can load more containers or prefer larger ships that carry more containers. As cargo on board increases and inflation increases demand costs and exacerbates backlog problems, logistics providers, cargo owners and shipping companies must work with their brokers to ensure their cargo is properly insured.
One of the effects of supply chain disruptions specific to maritime cargo insurance is the accumulation of cargo on ships and in warehouses. Cargo accumulation brought with it two dangers: insufficient cargo insurance and higher-than-expected losses. Large quantities and high value cargoes owned by the same insured in a single port, warehouse or ship may cause the cumulative cargo value to exceed the sea cargo policy limit and under-insure the cargo. Catastrophic damages and general average declarations for ships carrying accumulated cargo for a single insured can cause enormous losses.
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"Most customers are faced with the need to increase their policy," Jesutko said. "You should make sure that your insurance policy covers the valuables you carry.
The rise of very large ships to meet the demands of modern supply chains further complicates matters. Logistics companies use these larger vessels to transport cargo, but as many will see at the Ever Give docks in the Suez Canal in 2021, larger vessels can get stuck trying to navigate the narrow waterway, causing further delays.
"To accommodate the increasing volume of cargo being carried, ships are being built on a larger scale than ever before. This makes it very difficult for them to navigate," Rezotko said.
While several factors have contributed to shipping delays over the past few years, leading to an increase in claims of shipping delays and theft, Rzeszutko is seeing things calm down as we enter 2023. Ports received less support to return to pre-pandemic shipping conditions. "We don't see as many replacements as in 2022," said Zhesutko.
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By partnering with risk managers experienced in logistics, cargo owners and logistics providers can further reduce the burden of supply chain delays and help plan alternative routes in severe weather or other conditions that could lead to channel blockages, port closures or other incidents. other complicating factors.
"Consider alternative routes to minimize delays." If unfavorable conditions mean that one route takes three weeks, another route may take two weeks. "There may be additional costs associated with this change, but it is an option for businesses."
Ships not only carry more cargo, they also carry more cargo. They carry something more valuable. Inflation increases the price of nearly all consumer goods, as well as fuel costs and transportation costs. Therefore, when a marine insurance claim occurs, the loss is greater due to the increased cost of the cargo.
Inflation indirectly increases the risk of goods. BSI's Cargo Theft Report 2022 states: "From a cargo crime perspective, there is an increasing demand for cheaper goods as the economy slows and the cost of living rises. This indirectly encourages cargo theft as a crime Molecules can steal essential or high value goods. They buy it and sell it on the black market for much lower prices.
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In addition to increased market demand for stolen goods, inflationary increases in commodity prices may also make them more attractive to thieves. This, in turn, could lead to higher insurance costs or policy limits, Zheshutko said. When shipping high-value cargo to high-risk areas, insurance companies may require companies to use GPS tracking devices or hire armed guards before insuring policies.
"There may be a policy protection depending on what is sent and where," he said.
As supply chain and inflationary pressures increase the value of insured cargo accumulated on board, logistics service providers, cargo owners and shipping companies must ensure that insurance limits are adequate and sometimes seek to increase coverage limits to ensure their cargo is protected.
“Talk to your insurance broker to make sure your policy has the appropriate limits for your risk,” Rezotko said.
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Munich Re offers marine insurance solutions that protect policyholders' assets during transport or storage. The strong underwriting team behind these policies can assist insureds who need to increase their limits or seek coverage while dealing with supply chain and inflation risks.
“Most customers are faced with the need to increase their policy limits,” Reshutko said. "You should make sure that your insurance policy covers the valuables you carry.
The right team of intermediaries, risk managers and shippers will evaluate the specific risks faced by logistics service providers, cargo owners and shippers and what policy solutions will work best. Many companies can benefit from a comprehensive policy rather than incurring slices of risk.
"If you have an established delivery history, you can tailor your all-shipping master policy to suit your business needs. Consignment insurance can provide less specific coverage," says Rzeszoutko.
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Munich Re has a marine underwriting team with extensive industry knowledge and an in-house claims team ready to support policyholders in the event of a loss.
Rzeszoutko said, "We have a strong in-house claims team as well as extensive insurance experience. These two factors do not differentiate us in the market.
Supply chain risk and inflation are changing rapidly, so insurers want to work with carriers who keep a close eye on industry trends. The Munich Re team has extensive industry knowledge and is always looking for new ways to support their customers.
Along with supply chain and inflation concerns, Jesutko said shippers are seeing a growing interest in shifting their business to challenging new commodities such as renewable energy and seeking insurance that covers shipments of solar panels or wind turbines.
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Whatever the risk, partnering with a strong carrier with top insurance and damage capability can help shippers know they will be protected in the event of a damage, no matter how much the risk changes.
This article was produced by R&I Brand Studio, part of the Risk & Insurance Advertising division, in collaboration with Munich Re Specialty Insurance. Risk & Insurance's editorial team played no part in its preparation. The marine construction industry in the United States is booming for several reasons. Ports across the country are expanding and deepening shipping lines to accommodate larger so-called post-Panamax vessels. This doesn't just mean deepening the funnel. Docks, berths, cranes and other coastal infrastructure must be strengthened to withstand stronger blows from ships. Other infrastructure and bridges also need to be updated for the 21st century.
Plus, the growing pleasure boat population is encouraging marinas to expand their footprints to accommodate larger yachts and other recreational boats. The 2017 hurricane season was active and resulted in chaotic rebuilding needs for marinas and other structures along the affected waterways.
But these are just a few of the reasons why today's shipping contractors have such a heavy workload. Minor construction and maintenance jobs also constantly require the expertise and skills of marine contractors to keep American traffic going. When construction is done in or near water, a professional marine contractor is likely to be needed and their knowledge and experience can be invaluable. Offshore contractors are tasked with doing some very dangerous work; therefore, protecting their property and assets requires a high degree of focus on workplace exposure management.
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Maritime contracts are not for the fainthearted. It is listed as one of the most dangerous occupations in the workforce. Consider the environment of a marine contractor. Working on or near water increases the risk of slipping or falling. Contractors can be fired
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