With a manufacturing process that involves a global supply chain, automaker Ford has had layers of CBI coverage in place for years. The importance of that coverage, structured by Marsh, became apparent after the Japanese earthquake and tsunami. Although Ford can't comment on total claim payments, simply evaluating the magnitude of the loss took in excess of six months as the company worked to create alternate sourcing arrangements.
Following the losses that hit the automotive industry, Ford also saw a reduction in limits, increasing its effective retention. “The market didn't react significantly to Japan at first, but with Thailand following closely, there was a significant restriction in coverage,” reports Daniel M. Ames, the company's associate director of corporate insurance.
Ames anticipates market capacity gradually increasing in the months ahead. “I expect to see that happen in 2013 as insurers become more comfortable to their aggregate exposure, which will allow them to better manage capacity. I also expect going forward that the industry is going to differentiate better between their clients within industry classifications so that they will provide belter coverage, limits and pricing to those that demonstrate a better understanding of their supply chain.”
Recommended For You
Want to continue reading?
Become a Free PropertyCasualty360 Digital Reader
Your access to unlimited PropertyCasualty360 content isn’t changing.
Once you are an ALM digital member, you’ll receive:
- Breaking insurance news and analysis, on-site and via our newsletters and custom alerts
- Weekly Insurance Speak podcast featuring exclusive interviews with industry leaders
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical converage of the employee benefits and financial advisory markets on our other ALM sites, BenefitsPRO and ThinkAdvisor
Already have an account? Sign In Now
© 2025 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
