Small Oversights Can Become Significant Losses
Risk does not always begin with a major failure.
A small electrical fault, inadequate housekeeping, incomplete cargo information, an underestimated sum insured, or delayed reporting after an accident can become significant when combined with the right circumstances.
The newsletter highlights three situations in particular.
Climate & Fire Risk
A longer and drier dry season can increase the potential for fire across industrial areas, warehouses, facilities, and other properties.
The risk may begin with something seemingly minor — a short circuit, an improperly extinguished cigarette, or sparks from welding activities.
Marine Cargo Risk
Choosing insurance based primarily on the lowest premium can create a much larger problem later.
The newsletter identifies five common mistakes:
- Choosing the cheapest premium.
- Underinsuring the cargo.
- Incomplete cargo and transportation information.
- Arranging insurance after shipment.
- Purchasing without adequate risk consultation.
Project Accident & Claims Risk
When an accident occurs, the response in the first 24 hours can influence what happens next.
Evidence can change. Witness accounts can become difficult to establish. Damaged assets may be moved or repaired.
A delayed or poorly documented response can therefore make an already difficult claim significantly more complicated.
These are not simply insurance issues.
They are risk management issues.
The three situations are discussed in Risk Management Insight #1–#3 on pages 4–5.
