Pandemics, climate change, increasing frequency of natural disasters, and the growth of complex supply chains means contingent business interruption (CBI) coverage is more important than ever. In an interview with Insurance Business magazine, Partner Michael Gehrt discussed CBI coverage and a recent case involving a satellite television company’s supply of hard drives impacted by flooding in Thailand.
Gehrt explained that until now many businesses never thought about the extent of their CBI coverage. “Many of these businesses leave CBI coverage as an afterthought because they have insurance for their physical locations and don’t anticipate the impact a catastrophic event can have on their suppliers,” added Gehrt.
“Hurricanes and other extreme weather can cause economic losses around the world as the disruption ripples through supply chains. It can take years for a company to recover from such a disruption. CBI insurance is designed to cover that supply chain risk and should be carefully considered whenever a company is experiencing supply chain issues,” he added.
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