Top 5 Risks Facing Manufacturers
August 13, 2021 | Shaping Iowa's Leaders of Tomorrow
With a renewed focus on manufacturing in the U.S., it may be time to revisit your company’s risks and insurance coverage. The industry is changing; from government regulations to environmental and employment laws, manufacturers face various risks. In this article, I’ll touch on some of the risks that rise to the top.
In the ever-evolving manufacturing industry, embracing change is necessary in order to gain market share and stay ahead of the competition. Change often comes in the form of technology – and the interconnectivity of equipment and devices within an internet infrastructure. This ‘Internet of Things’ can optimize production and reduce costs, but it does come with risk. Even secure networks are vulnerable to cyber-attacks, which can impact customer privacy and impede production.
Cybercrime is growing, making Cyber Coverage a crucial safeguard from the devastating consequences of an attack.
Even before COVID-19, manufacturers were reshoring; however, supply chain disruptions exacerbated by the pandemic have prompted more manufacturers to diversify and near-source materials. This trend will help companies withstand supply chain interruptions but is only part of an overall strategy. When your business relies on your supply chain, Commercial Property Coverage can take on some of the risks.
Safety is always a priority for manufacturers, but COVID-19 gave rise to Employment Practices claims related to unsafe working conditions, discrimination, and issues of over layoffs. Employment-related claims can disrupt operations and cost the company financially.
It’s difficult to anticipate what can trigger an employment claim, but Employment Practices Liability coverage can provide protection for defense and covered settlements.
Product Liability and Recall
As more states ease pandemic restrictions and the world re-opens, product recalls are expected to surge, and liability claims are predicted to significantly impact claim counts by the end of the year. Product failure can affect a company’s brand and reputation, but it can also lead to considerable financial loss. Adding coverage such as Product Recall protection to your General Liability policy can offer valuable protection.
Lawsuits are being filed with greater frequency, increasing the potential for catastrophic loss. Whether a lawsuit arises from operations, vehicle accidents, or product liability, jury awards have continued to increase. No matter the size of your business, a lawsuit can exceed your expectations and your coverage limits. Umbrella and Excess Liability coverage helps limit your expose from a spectrum of risks and provides protection from large claims.