While the mainstream press is focused on property damage,insurance-industry players know that Business Interruption andContingent Business Interruption claims from commercial clients aregoing to account for a hefty percentage of the claims resultingfrom Sandy.
|“The impact on the supply chain is going to be dramatic,” FMGlobal Vice President of Research, Dr. Louis Gritzo tellsNU. “Given the amount of commerce and transportation thatoccurs in Sandy's corridor, and the location of five major ports inits path, this event is going to ripple across the entire U.S.econonmy.”
|Gritzo points out that the most vulnerable businesses are thosethat have been most successful in practicing lean, “just-in-time”manufacturing processes. Those companies that don't have muchinventory to draw on could face a “long and painful” recovery asnew materials could be hard to come by.
|The companies best situated for a speedy recovery: Those thathave a flood-emergency response plan and have made sure that theirsuppliers have one as well; and those that have a plan for dealingwith extended power outages. “Keeping the water out and the poweron are the top priorities for getting a property back in business,”Gritzo says.
|For FM Global's clients, Gritzo notes that the company employs1,800 engineers–who can accompany claims adjusters and consult onways to minimize losses and get back to full speed as soon aspossible.
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