When the garage door to our house stopped opening last month, I figured the battery on the remote opener needed replacing and it would be a quick fix. But even with a supply of fresh batteries the door didn’t shift. Cleaning the eye of the sensors that are programmed to stop the doors in their tracks for sudden obstructions like skateboarding children didn’t work either. Neither did realigning the sensors. 

After a visit from the guy at the local company that has been fixing garage doors for more than 80 years, we learned that the problem was a broken spring. Easy fix, right? Not so fast. The springs are on backorder.

A call to the company that manufactures the doors informed us that there’s been a problem getting the springs and that shipments are few and far between. Garage door parts shortages are apparently widespread. Need a spring? Be prepared to wait weeks. Need a new garage door? The wait will be months. 

Production delays and shortages due to the pandemic have left garage door parts in high demand and short supply, along with many other goods. Prices are also up as manufacturers struggle to keep up with the demand. 

The pandemic has thrown business interruption into the spotlight, and supply chain disruption is top of mind for many corporate risk managers. The fragility of the interlinking system that underpins the economy and flow of goods around the world is being tested like never before. As we report on page 8, supply chain risks are complex and encompass not just ships, but shipping containers, warehouses, trucks, rail facilities and labor, all of which are in short supply. Accumulations of risk at the multiple chokepoints in the system are a rising concern. 

Traditional business interruption insurance policies generally would cover disruption at a manufacturing plant due to physical damage — and natural disasters like Hurricane Ida and winter storm Uri earlier this year have highlighted the need to be better prepared for such events. But clearly there are many other complex, interrelated causes that can leave a business without the parts or resources to operate. 

Several insurance coverages may come into play but whether they will respond is open to question. Cargo delays, unless they involve spoilage of perishable goods due to delay, are unlikely to be covered. Contingent business interruption insurance might be another source of relief for commercial property policyholders, if a covered loss — think a fire or hurricane — caused physical damage resulting in business interruption at the location of a supplier.

There are also some specialty supply chain policies available that can be tailored to cover disruptions that are not the result of physical damage, such as government actions, virus-related losses and civil unrest. Trade credit insurance is another important coverage seeing increased demand out of the pandemic that protects businesses against the risk of non-payment. 

Whatever policies they have in place, businesses should be taking a renewed look at their coverages and, crucially, the terms and conditions including limits, sub-limits and exclusions that may apply to their individual policies. Innovative insurance coverage is part of the answer, but risk managers, too, have an important role to play in shifting business mindsets and strategies to build a more sustainable approach to withstand future supply chain disruptions.