The industry is certainly aware of and gaining knowledge about supply chains—but the products being offered aren't necessarily keeping up with the risks, some experts say.
Warren Meigs, deputy property executive for the U.S. and Canada at AIG Property Casualty, said during Advisen's Property Insights Conference on June 11 that supply-chain exposures are not understood well enough and that contract wording is not uniform.
Gary Love, vice president and staff operations underwriting manager at FM Global, agreed. During a panel discussion on the topic of supply chain risk and contingent business interruption, Love said understanding the true risk of second-, third- and fourth-tier suppliers is a “daunting, daunting task,” and his feeling is that the industry has not yet stepped up to provide products to cover the types of losses laid bare by such recent events as the earthquake and tsunami in Japan, flooding in Thailand, and Superstorm Sandy in the Northeast U.S.
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