Page 41 - Insurance Times February 2022

steps to mitigate the impact of COVID-19. If companies suppliers and outsourced vendors in case primary
cannot fulfill their contractual obligations, they may need suppliers can no longer provide support.
to quantify the amount of financial damage and the impact e. Formulate contingency measures, give first response
on their long-term business relationships. Companies should and anticipate possible failures in the supply chain. For
review their existing insurance policies to find out whether
example, examine the capacity of other suppliers in
any losses they incur relating to COVID-19 can be covered other geographical areas, change the production mix
under existing terms or whether they need to adjust their
and plan for new delivery methods to reach customers.
coverage for additional protection.
Conclusion
9. Impact on Supply Chain Although they are often unique, emerging risks can be
The Risk: identified, evaluated and monitored, and response plans can
Governments around the world have begun to take be implemented when they occur. Emerging risk
measures that limit the movement of goods and people identification and assessment creates a competitive
advantage, helps "future proof" longer-term strategies,
across borders. Restrictions imposed by the Chinese
minimizes unwanted surprises, and allows organizations to
government, for example, have included quarantine
capitalize on opportunities.
mandates and factory shutdowns across the country. As
China is the factory of the world, supply chains are deeply Understanding the potential impact assists in risk
affected. management strategies and may reveal opportunities for
new revenue streams. Identifying and evaluating emerging
Considerations: risks empowers organizations to be forward-thinking,
If management believes there is a risk of disruption to their leading to increased readiness and resilience in the face of
supply chains, they should take the following steps, among new and developing threats.
others, to mitigate the potential consequences: References
a. Understand the behavior of disruptive models applied
1. https://web.actuaries.ie/sites/default/files/erm
to the supply chain and establish the point in time at
resources/
which such disruption is located. combating_insurance_claims_fraud_how_to_recognize
b. Consider re-prioritizing the production line to respond _and_reduce_opportunistic_and_organized_claims_fraud.pdf
to market impacts associated with the threat, 2. https://www.accenture.com/lv-en/~/media/Accenture/
increasing safety stock levels, and stockpiling essential Conversion Assets/DotCom/Documents/Global/PDF/
supplies and resources. Technology_8/Accenture How-Effectively-Fight-
Insurance-Fraud.pdf
c. Determine which vendors may be most severely
impacted and if alternative vendors can provide a 3. https://www.dxc.technology/insurance/insights/
139238-6_steps_for_preventing_insurance_fraud
solution to meet business needs.
4. https://www.weforum.org/agenda/2020/05/covid-19-
d. Pre-qualify alternative domestic or international risks-outlook saadia-zahidi/
5. https://www.swissre.com/risk-knowledge/mitigating-
climate risk/emerging-risks-trends-wake-
coronavirus.html
6. https://home.kpmg/kw/en/home/insights/2020/04/
emerging-risks-in kuwait-covid19.html
7. https://rims.nz/wp-content/uploads/2019/06/2019-
Emerging Risks_4232019_142053.pdf
8. https://theonebrief.com/2019s-top-10-risks-new-risks-
emerge-established risks-evolve/
9. https://www.bdo.com/insights/business-financial-
advisory/risk advisory/novel-coronavirus-(covid-19)-
impact-and-risk-respo.
Courtesy : Risk Management Association of India

The Insurance Times, February 2022 41