Insurance prices are now rising rapidly for companies across a broad range of sectors, but for companies in the food and beverage industry these increases are exacerbating pre-existing trends.
Concerns over food fraud, fire safety and now, Covid-19 are having an impact that is putting additional pressure on already tight margins. In fact, one UK broker recently reported that 56% of companies had cut costs as a result of rising insurance premiums, while 40% of food manufacturers say they have lost business as a result of their inability to meet liability requirements.
Despite their key role in keeping the UK provisioned throughout the pandemic, food and beverage firms face a number of powerful headwinds – all of which have big implications for risk and insurance:
- Food safety concerns are bringing supply chains under greater scrutiny
- At the same time, Covid-19 and Brexit are causing supply chain disruption, making it doubly hard for manufacturers and processors to comply with distributors’ requirements
- Fire losses in the period since 2017 have been linked to combustible cladding, leading to massive reductions in insurer appetite and constrictions on market capacity for property insurance
- Recent outbreaks of Covid-19 in the UK, US, Germany and elsewhere, linked to food manufacturing plants, may represent a growing problem – with ramifications for Directors’ and Officers’ insurance, Employer’s Liability and Employment Practices Liability
- Changing operations as a result of Covid-19 will mean many firms in the sector are not fully covered and may be in breach of existing policy terms
All too often, brokers tell their clients there’s nothing they can do about the harsh terms on offer from insurers, or that ‘you’re luckier than some of my other clients’. This shouldn’t be an acceptable answer when you are doing all you can to protect your business through the most challenging of times.
The good news is that there is another solution. Mactavish can help unlock additional capacity for you, giving you a range of options and driving better outcomes from the market.
Mactavish has developed a unique model designed to deliver against policyholder needs, rather than simply passing on changes in market dynamics. We empower our clients to take control of their insurance programmes, reduce their costs and improve the quality of their cover.
Our recent Broker Conflicts Report demonstrated that some brokers derive up to 80% of their revenue from insurers and only 20% in direct fees from policyholders. Worse, their earnings may be linked to rates and premium volumes, meaning the less hard they try to broke your risk the more they stand to make.
We’re different. 100% of our revenue comes in direct and transparent client fees. So you can be sure that we represent your interests and no one else’s.
The figures speak for themselves. On recent projects we’ve been able to reduce premium costs by between 20% and 50% against initial broker estimates.
As the market has hardened in recent months we’ve been able to help unlock additional capacity for our clients which wasn’t made available by their brokers. Rather than feeling like they have to take whatever is available, our policyholders have options and choices – putting them in control of their risk transfer programme.
But that isn’t all. Our heritage is in legal reform and we remain true to our roots by driving for better coverage for all of our clients. In many cases we make over 50 amendments to policy wordings to better respond to our clients’ exposures – so you can be sure that you’ve not only paid a good price, but got a great product too.
We also manage claims disputes on behalf of policyholders of all sizes, with the hard market making disputes even more commonplace. So far, in 2020, we’ve helped clients manage claims with a total value in excess of £400m – with a unique proposition that explores every available route to fair, rapid resolution.
In many respects coming out of lockdown is one of the most commercially and operationally challenging aspects of the pandemic. Social distancing, evolving government guidance, changing business models and disrupted supply chains are just some of the difficulties faced by companies across the UK.
Insurance is often overlooked amidst all of this change, but it’s very easy to find that you’ve breached the terms of your policies or failed to disclose a material change that can leave you, for all intents and purposes, without cover in the event of a major claim.
The Mactavish Health Check is designed to help you get a grip on your risk transfer programme and provide actionable guidance on what you need to do now in order to protect your firm through Covid-19 – maximizing cash recovery and safeguarding your insurance protection.
How to contact us
We think policyholders deserve better outcomes from the insurance market.
Contact us via the form below, or the phone number and email address on our contacts page to see how we can help you take control of your risk transfer programme and protect your company.