Are you aware of the hidden Brexit risks businesses could already be facing today?
On March 29, 2019, the UK is scheduled to leave the EU. With just a few months to go and so much continuing debate, there is a great deal of uncertainty for British industry and professional services.
The outcome of the ongoing negotiations will not only impact on decisions Businesses need to make from staffing to international trade, but other increased costs need to be considered, which could have an impact on Business insurance needs to ensure adequate risk protection remains in place.
Fluctuating exchange rates and the impact on lead times for plant, machinery and stock need to be on the agenda of every business which trades with our European neighbours.
One immediate issue concerns the value of sterling. This impact could mean increases in the reinstatement cost of any replacement plant that is sourced from Europe. If the exchange rate drops by 15%, the actual cost of reinstating an item of plant from say, Germany or Italy will increase accordingly. Every business who buys equipment from our European neighbours must take this real issue into account and review their insurance policy sums insured regularly, or risk being underinsured and exposed to reduced claim payments.
Equally, lead times for equipment or orders of replacement stock may be extended due to the impact of transportation and customs delays together with unexpected effects on manufacturing supply from European producers. Business Interruption (BI) maximum indemnity periods need to be reviewed to account for supply chains becoming more complex as the introduction of customs inspections and regulatory requirements increases the time it takes to get goods from one country to another. It may be necessary to increase the BI maximum indemnity period to protect against the unknown but anticipated impact on supply chains and lead times.
Being under insured not just on the equipment values, but recovery time and indemnity periods, could make the difference of a business surviving or not after an event. Regular reviews of these issues at Board level are prudent.
Hamilton Bond can add value to business insurance by providing expert claims consultants, who are committed to steering a claim to the optimum settlement.
We can also support by providing a Business Interruption cover review service. This is designed not only to establish the correct sum insured but also to comment on the most appropriate maximum indemnity period, having regard to the nature of the business and the number and relative importance of customers to the business.
For more details on the services we provide, or to support you with a claim please contact us on 01905 726407 or email firstname.lastname@example.org