Recent events around the world have highlighted the critical—and sometimes delicate—nature of the supply chains many companies rely upon to produce their products and deliver them to customers. And with companies' operations increasingly centered on just-in-time inventory strategies and outsourcing the manufacturing of product components, along with the rise of online communications and advances in worldwide delivery, supply chain risks aren't just the province of large businesses today, with even smaller companies tied into far-flung vendor networks or distribution systems. ›› More

KYODO/LANDOV

The 2011 Japanese earthquake and tsunami caused widespread supply chain disruption, particularly in such industries as automotive, electronics and aircraft manufacturing, with the impact reflected later in the year in company earnings statements. This piece looks at the impact of the event on supply chains, some of the risk management and insurance coverage challenges the event brought to the fore, and ways businesses have responded, as well as how the experience might help them better address suppy chain exposures going forward. ›› More

The impact of the 2011 earthquake and tsunami in Japan were felt around the world, though supply chain interruptions resulting from those events were largely uninsured, according to speakers at the 2011 Risk & Insurance Management Society Inc. conference in Vancouver, Canada. And for those with coverage, claims were likely to be complex and require extensive documentation. Some expect the event to result in higher rates for coverages related to supply chain risks, along with more restrictive terms. ›› More

A recent survey showed a vast majority of companies experienced some sort of supply chain disruption in the past year with weather the most frequent cause. And, while the majority of disruptions originated at Tier 1 suppliers, many had their start further down the supply chain. ›› More

REUTERS

The extent of the supply chain impact of floods in Thailand seemed to take many by surprise, hitting the electronics industry and automobile makers hard and threatening to produce challenging questions over some of the insurance claims sure to emerge as a result of supply chain disruptions. ›› More

AP

The implications of supply chain disruptions from flooding in Thailand were felt around the world, but flooded factories and transportation issues caused supply issues for many companies within Thailand as well, forcing them to shut operations or look to for alternative suppliers. ›› More

An incident in 2010 demonstrated how supply chain risks are not only hazard-related but can be political in nature, as Chinese leaders decided to dramatically scale back the export of rare earth elements to better serve growing local demand. With China previously supplying almost all the world's demand for the elements—and the metals being essential to many manufacturers of electronics, optics, rechargeable batteries and other products—China's decision proved a financial and operational headache for many companies, forcing manufacturers to scramble to find other sources of the metals. ›› More

AP

The disruption of supply chains worldwide resulting from floods in Thailand and along with the impact of the Japanese earthquake and tsunami in March is prompting companies to look at aspects of supply chain risk they might have previously overlooked and find new ways to address those exposures. ›› More

As they look to address supply chain exposures, companies are working harder to understand risks associated with their external partners, including engaging insurance companies to provide on-site supplier inspections and make necessary recommendations. ›› More

REUTERS

As natural disasters in 2011 that disrupted supply chains worldwide raised some manufacturers’ awareness of supply chain risk, others have been taking steps to address the exposures holistically, identify exposures far up the chain and quantify their exposures. ›› More

There are various insurance products in the market to address aspects of supply chain risk. This article looks at the market for supply chain risk insurance and what sorts of coverage are available, along with some of the challenges insurers face in trying to accurately gauge a potential customer's exposure. It also examines the impact recent events that have disrupted global supply chains have had on the market and whether there's been any increase in rates or any change in capacity or underwriting the coverage. ›› More

American manufacturers buying products from Chinese suppliers are taking steps to protect themselves from product liability claims and ensure the quality and safety of the goods those offshore partners are providing. ›› More

Recent events have demonstrated that a break in the supply chain can come from a variety of directions. In response, some companies have looked to reduce the scope of their supply chains, though such moves as reducing the number of vendors might actually reduce business resiliency when a supply chain breach occurs. For risk managers, concerns about their organizations' supply chain exposures can provide a great opportunity to take the lead in looking across the various areas of the business in which supply chain risk might reside. This story examines the impact of recent catastrophes on supply chains, and presents the thoughts of some industry experts on how to manage the risks. ›› More

Dealing with suppliers and customers around the world, many of them in developing nations, Sanofi-Aventis Groupe faces a variety of potential supply chain disruptions. In this piece, Francoise Carli, vp, insurance, at the Paris-based pharmaceutical firm, outlines how the company has addressed those exposures, including its use of insurance products such as stock-in-transit coverage, how it's brought its captive into play as a tool in controlling some of those risks, and steps the company has taken to better measure some of its exposures. ›› More

Pharmaceutical companies are among the businesses outsourcing much of their manufacturing beyond the borders of the United States. But, while outsourcing cuts costs, lack of adequate regulation in some countries creates potential supply chain exposures. In addition, the pharmaceutical supply chains are vulnerable to the same sorts of natural catastrophe threats that can disrupt business for other manufacturers. In this piece, an insurance underwriter for the pharmaceutical industry examines some of the supply chain risks associated with this outsourcing and how pharmaceutical companies can address them. ›› More

In a Business Insurance webcast, “Supply Chain Crisis—Navigating Business Interruption Coverage and Claims After the Japanese Earthquakes,” industry experts examine insurance coverage issues related to business disruptions stemming from the March earthquake and tsunami in Japan. Panelists discuss some of the coverages that might be available to respond to losses in such instances, as well as some of the steps businesses should take in the event of such a disruption to minimize the possibility of disputes with their insurers. ›› More

AP

The use of lead-based paints and magnets that were easily swallowed in toys manufactured in China prompted Mattel Inc. to recall millions of toys in 2007. In other cases, pet food companies have been forced to recall tainted products manufactured by vendors overseas, while builders have faced issues over Chinese-made drywall. This piece examines how companies can maintain safety along their supply chain for components and materials, and how they should work with suppliers to minimize risks and ensure those suppliers adhere to their standards. ›› More

Willis Group Holdings P.L.C. has developed an insurance product to cover business disruptions resulting from exclusion zones implemented to contain damage from incidents at nuclear power plants. ›› More

With supply chain risks often extending down the chain beyond the vendor with which a company has contracted to "suppliers of the supplier," how does a company identify the sources and extent of its supply chain exposures, and how does it monitor them over time? This piece examines what goes into an analysis of supply chain exposures and what companies need to consider to successfully audit their supply chains, monitor risks that might change over time, identify emerging exposures and work with vendors and other business partners to address supply chain risks. ›› More

Archer Daniels Midland Co.'s business is global in scope, with the company doing business everywhere “where food is grown,” according to Michael Lusk, vp of insurance & risk management at ADM. This piece examines how Mr. Lusk and his team seek to identify and address possible threats to ADM's supply chains, staying closely involved with operations around the world—understanding that local teams often are in the best position to understand local exposures—employing an enterprise risk management approach to identify and address political risks to supply chains and, of course, doing a lot of traveling. ›› More