emerging risks in marine transportation webinar...forms of marine liability. through his knowledge...
TRANSCRIPT
![Page 1: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/1.jpg)
1
Emerging Risks in Marine Transportation Webinar
![Page 2: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/2.jpg)
2
About Advisen: Advisen Ltd. is a privately-owned, independent and unbiased provider
of news, data and risk analytics to the commercial insurance industry.
Advisen’s mission is to deliver productivity and insight to insurance professionals. Advisen brings greater success though
technology and data, revolutionizing the way the commercial
insurance industry functions. Our customers leverage the Advisen
platform, adding power to their proprietary ability and bringing
value to their clients.
Please locate us on: www.advisen.com
![Page 3: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/3.jpg)
Many Thanks to our Sponsor!
![Page 4: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/4.jpg)
4
About Aon: Aon plc (NYSE:AON) is the leading global provider of risk
management, insurance and reinsurance brokerage, and human
resources solutions and outsourcing services. Through its more
than 62,000 colleagues worldwide, Aon unites to empower results
for clients in over 120 countries via innovative and effective risk
and people solutions and through industry-leading global
resources and technical expertise. Aon has been named
repeatedly as the world’s best broker, best insurance intermediary, reinsurance intermediary, captives manager and
best employee benefits consulting firm by multiple industry
sources.
Visit www.aon.com for more information on Aon and
www.aon.com/manchesterunited to learn about Aon’s global partnership and shirt sponsorship with Manchester United.
![Page 5: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/5.jpg)
5
Emerging Risks in Marine Transportation
http://corner.advisen.com
• White Paper: Industry Analysis: Marine Transportation
• Copy of these slides
• Recording of today’s webinar
![Page 6: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/6.jpg)
Today’s Moderator
David Bradford- President, Research & Editorial Group, Advisen Ltd.
![Page 7: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/7.jpg)
Today’s Panelists
Barbara Spain, Senior Vice President, National Logistics Manager- Marine, Aon Risk Solutions
Patrick Hickey, Vice President- Cargo, Zurich Global Corporate
Robert DeMotta, U.S. Practice Leader- Marine, Aon Risk Solutions
Linda Conrad, Director of Strategic Business Risk Management, Zurich
Anthony J. Ten-Barge, Director of Risk Management, Genco
![Page 8: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/8.jpg)
Today’s Panelists Robert DeMotta, U.S. Practice Leader- Marine, Aon Risk Solutions Role Bob is the U.S. Practice Leader for Aon Broking’s Marine Practice. Responsibilities include strategic planning for Aon’s presence in the marine industry and consistent delivery of high quality products and services. Bob personally leads the Account Executive or broking role for serveral large Aon marine accounts. He participates and/or assists others in the marine practice with the strategic program design for many marine accounts. Experience Bob has devoted most of his 30+ year career to the design, placement and handling of large risk management programs, predominantly for marine industry companies. Technical coverage experience includes Cargo, Hull, P&I, Builders Risk, Terminal Operators, and other forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new products and services for marine clients. Education/Service Bob earned his B.A. from the State University of New York at Stony Brook. His completed his post graduate studies at The College of Insurance, New York and The School of Offshore Operations, Texas. Bob also maintains his broker’s licenses in New York and several other states. He is an Associate Member of the American Institute of Marine Underwriters, Chairman of the American Institute Marine Underwriters Producer Advisory Committee, and Council Member of American Bureau of Shipping – Special Underwriting Committee.
![Page 9: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/9.jpg)
Today’s Panelists Barbara Spain, Senior Vice President, National Logistics Manager- Marine, Aon Risk Solutions Role Barbara is the National Logistics Manager for Aon’s Marine Practice. She assists colleagues and their Third Party Logistics clients and prospects by using her vast knowledge of the industry and applying services that Aon can offer. She also assists in broking logisitcs. Expertise Barbara has over thirty years of insurance knowledge as both an underwriter and insurance broker, with her recent years specializing in insurance solutions for third party logistics providers and Fortune 1000 companies with dedicated logistics operations. Barbara’s specialty is customizing insurance programs for each individual logistic client’s unique and specific needs. She understands the quick paced world of logistics and ensures that each client’s needs are met on a timely basis. She was recognized by Risk and Insurance Magazine as one of the top six international marine Power Brokers for 2012. Education/Service She is a member of the American Institute of Marine Underwriters, Council of Supply Chain Management Professionals, and past president of the Propeller Clun, Port of Chicago.
![Page 10: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/10.jpg)
Today’s Panelists Patrick Hickey, Vice President- Cargo, Zurich Global Corporate Patrick Hickey is the senior ocean cargo product line officer for Zurich in North America. He is responsible for underwriting, strategy, planning, marketing, compliance and IPZ (International Programs from Zurich) for the cargo portfolio. Hickey is a dedicated ocean marine professional with more than 20 years in the field. Prior to joining Zurich, he was Vice President, Western Zone with AIG Global Marine & Energy and focused his attention on Fortune 500 multinational corporations. Hickey has managed national broker relationships and multi-line insurance product offerings for global freight forwarders and third party logistics providers. His past experience has led him to opportunities in the New York, Los Angeles and San Francisco marine markets. He is a past officer of the Marine Underwriters of Southern California and past President of the Board of Marine Underwriters of San Francisco, Inc. He is currently a member of the American Institute of Marine Underwriters (AIMU) Cargo Committee and the National Cargo Bureau.
![Page 11: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/11.jpg)
Today’s Panelists Linda Conrad, Director of Strategic Business Risk Management, Zurich Linda Conrad is Director of Strategic Business Risk for Zurich. She leads a global team responsible for delivering tactical solutions to Zurich and to customers on strategic issues such as business resilience, supply chain risk, Enterprise Risk Management (ERM), risk culture and Total Risk Profiling. Linda also addresses enterprise resiliency issues in print and television appearances, including CNBC, Fox Business News and the Financial Times, and is featured in a Wall Street Journal site. Linda holds a Special designation in ERM, and serves on the Board of the Institute of Risk Management in London. Linda is deputy member of the ERM Committee of RIMS, sits on the Supply Chain Risk Leadership Council, and was Chairwoman of the Asian Risk Management Conference. She has taught at University of Delaware Captive program and in the Masters on Supply Chain Management program at University of Michigan’s Ross School of Business, where she also serves on the Corporate Advisory Council. Linda studied at the Graduate Institute of International Studies in Geneva, Switzerland and Fox Business School.
![Page 12: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/12.jpg)
Today’s Panelists Anthony J. Ten-Barge, Director of Risk Management, Genco Experience Tony has over 20 years of operational risk management experience at a multinational electronics firm, aerospace, automotive remanufacturer, and logistics. He has extensive experience in managing the due diligence process and managing liabilities during and after transaction. His expertise also includes the managing of environmental remediation, compliance and regulatory affairs, facility security, contract management and review as well as risk project management. While at the multinational electronics firm he managed the international program and a special worldwide HPR engineering and business interdependency program which reduced the property loss exposure and quantified the business interruption and contingent business interruption exposure. The aerospace firm was a portfolio legacy company of a major private equity firm. While there Tony quantified, managed, reduced and eliminated liabilities of operations previously closed and sold, including a Bermuda captive. He reduced workers’ compensation claims cost for ongoing operations and placed aircraft products liability insurance. Tony has also developed cost effective loss control and security programs and has implemented and monitored environmental risk control programs. Service Tony is on the Board of Trustees of the Dwight D. Eisenhower Society of Gettysburg, PA which manages a trust to provide Eisenhower Leadership Scholarships at Gettysburg College and to ROTC students and oversees the management of the Eisenhower Farm National Historic Site in Gettysburg, PA.
![Page 13: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/13.jpg)
How has the prolonged downturn in the global economy impacted the marine transportation industry?
Linda Conrad, Director of Strategic Business Risk Management, Zurich
Dave Bradford- Advisen Ltd.
Robert DeMotta, U.S. Practice Leader- Marine, Aon Risk Solutions
Patrick Hickey, Vice President- Cargo, Zurich Global Corporate
Barbara Spain, Senior Vice President, National Logistics Manager- Marine, Aon Risk Solutions
Anthony J. Ten-Barge, Director of Risk Management, Genco
![Page 14: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/14.jpg)
Shipping Market
Source: IUMI and Bloomberg
![Page 15: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/15.jpg)
What are some of the changes to transportation you have observed over this period?
Linda Conrad, Director of Strategic Business Risk Management, Zurich
Dave Bradford- Advisen Ltd.
Robert DeMotta, U.S. Practice Leader- Marine, Aon Risk Solutions
Patrick Hickey, Vice President- Cargo, Zurich Global Corporate
Barbara Spain, Senior Vice President, National Logistics Manager- Marine, Aon Risk Solutions
Anthony J. Ten-Barge, Director of Risk Management, Genco
![Page 16: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/16.jpg)
U.S. 3PL Market 1996-2012E (US$ Billions)
Source: Armstrong & Associates
![Page 17: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/17.jpg)
17
Logistics Trends in Supply Chain Management
• Order Management
• Warehouse Management – Logistics Global Clusters
• Labor Management
• Yard Management
• Transportation Management
• Carrier Management
• Trading Partner Management
• Reverse Logistics RFID Solutions
• Risk Management
• Reshoring
![Page 18: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/18.jpg)
Focusing on the logistics industry, how important is this business to the economy and what are its growth expectations?
Linda Conrad, Director of Strategic Business Risk Management, Zurich
Dave Bradford- Advisen Ltd.
Robert DeMotta, U.S. Practice Leader- Marine, Aon Risk Solutions
Patrick Hickey, Vice President- Cargo, Zurich Global Corporate
Barbara Spain, Senior Vice President, National Logistics Manager- Marine, Aon Risk Solutions
Anthony J. Ten-Barge, Director of Risk Management, Genco
![Page 19: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/19.jpg)
The U.S. Business Logistics System Cost is the
Equivalent of 8.5 Percent of Current GDP in 2011
Up 7.6%
Up 6.2%
Up 6.6%
19
$ Billions
Carrying Costs - $2.184 Trillion All Business Inventory
Interest Taxes, Obsolescence, Depreciation, Insurance Warehousing
3 294 120
Subtotal 418
Transportation Costs
Motor Carriers Truck – Intercity
Truck – Local
431
198
Subtotal 629
Other Carriers Railroads
Water (International 28, Domestic 5)
Oil Pipelines Air (International 16, Domestic 15)
Forwarders
68
32
10 32
35
Subtotal 177
Shipper Related Costs 10
Logistics Administration 49
TOTAL LOGISTICS COST 1,282
Source: 2012 CSCMP Annual State of Logistics Report
![Page 20: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/20.jpg)
U.S. 3PL/Contract Logistics Market
3PL Segment
2011
Gross Revenue/Turnover
(US$ Billions)
Domestic Transportation Management – Asset Based (1) 11.1
Domestic Transportation Management – Non Asset Based 41.3
International Transportation Management 46.1
Value-Added Warehousing and Distribution 34.0
Software 3.0
Total (2) 133.8
![Page 21: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/21.jpg)
What are some of the Risk Management issues for companies in the logistics business? Are all logistics services and contracts the same?
Linda Conrad, Director of Strategic Business Risk Management, Zurich
Dave Bradford- Advisen Ltd.
Robert DeMotta, U.S. Practice Leader- Marine, Aon Risk Solutions
Patrick Hickey, Vice President- Cargo, Zurich Global Corporate
Barbara Spain, Senior Vice President, National Logistics Manager- Marine, Aon Risk Solutions
Anthony J. Ten-Barge, Director of Risk Management, Genco
![Page 22: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/22.jpg)
Operational Risk Management
Responsible for Limiting Loss Due to Operations
Identify Risks
-Operating Environment
-Internal Operations
-Stakeholders
-New Operation & Divestures
22
![Page 23: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/23.jpg)
Operational Risk Management
• Contractual Risk
• Liability Risk
• Professional Liability Risk
• Environmental Liability Risk
• Crime and Theft Risk
• Workers’ Compensation Risk • Contract Employee Risk
• Employment Practice Liability Risk
23
![Page 24: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/24.jpg)
Logistics Risk Management (From 3PL Perspective)
• Components of Logistics Risk Management – Senior Management – Risk Manager – Logistics/Transportation Manager – Procurement Officer
• Business Insurance Protection – Property/Casualty Insurance – Cargo Liability Insurance – Professional Liability Insurance – Worker’s Compensation – Crime – Supply Chain Insurance
• Transfer Options for Customers – Shipper’s Interest Insurance – Who’s placing? Buyer/Seller/3PL – Customs Bonds – Buy your own or outsource?
• Issues – Loss Valuation
![Page 25: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/25.jpg)
Logistics Risk Management
• Contract Negotiations
-Key Contract Components
• Liability
• Shippers Interest
-Time Schedules
• Non-Standard Risk Issues
• Customer Bidding
-Bid specifications – reasonable/unreasonable
• Unusual requests
-Competition
![Page 26: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/26.jpg)
Standard Terms & Conditions • Standard contractual trading conditions for freight forwarders and customs
brokers in the United States. Similar rules are followed by other major trading nations of the world.
• Contents Be Careful
– Service by third parties -- Reviews by management, risk managers,
– Indemnification for freight & duties attorneys, underwriters – Choosing routes/agents, etc. -- Ability to negotiate terms &
conditions – Quotations not binding -- More and more contracts! – Duty to furnish information – Declaring higher value – Insurance Requirements – No responsibility for government requirements – Loss or damage due to delay – Limitations for loss – Presenting claims – Construction of terms and venue – Indemnity clauses – Force Majeure
![Page 27: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/27.jpg)
What are the key insurance needs of a logistics company, and are there any specialty coverages required?
Linda Conrad, Director of Strategic Business Risk Management, Zurich
Dave Bradford- Advisen Ltd.
Robert DeMotta, U.S. Practice Leader- Marine, Aon Risk Solutions
Patrick Hickey, Vice President- Cargo, Zurich Global Corporate
Barbara Spain, Senior Vice President, National Logistics Manager- Marine, Aon Risk Solutions
Anthony J. Ten-Barge, Director of Risk Management, Genco
![Page 28: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/28.jpg)
28
Logistics Customers Need Strong Broker Capabilities
• Markets – strong relationships with the highest quality international insurance markets
• Risk Control – claims specialist who provide claims handling, settlement and recovery services on an international basis
• Technology – intranet capabilities tailored to fit the needs of each individual client
• Service – prompt day-to-day service that understands the pace of the logistics industry
• Global Operations – Global buying power with centralized coordination and standards and local service
• Intellectual Consultation – Enterprise Risk Management; Supply Chain Management
![Page 29: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/29.jpg)
Three Aspects to Your Policy
Pre Loss—How to Get Details Right
Insured Insurer
Expectation GAP
in event of claim
Policy
Wording
Expectation Gap
Insured Insurer
Policy Structure
Policy Declared
Values and Limits
![Page 30: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/30.jpg)
Is the insurance marketplace receptive to logistics risks? Are there any specific underwriting concerns and/or solutions?
Linda Conrad, Director of Strategic Business Risk Management, Zurich
Dave Bradford- Advisen Ltd.
Robert DeMotta, U.S. Practice Leader- Marine, Aon Risk Solutions
Patrick Hickey, Vice President- Cargo, Zurich Global Corporate
Barbara Spain, Senior Vice President, National Logistics Manager- Marine, Aon Risk Solutions
Anthony J. Ten-Barge, Director of Risk Management, Genco
![Page 31: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/31.jpg)
Marine Premium 2011
by Line of Business
Source: IUMI
![Page 32: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/32.jpg)
Market Availability
• Broader coverages available – specifically developed for logistics
• Global economy / supply chain
• Success requires using specialized global service providers
• Typical limits
– Cargo Liability: $1 Million and up
– Motor Truck Cargo Liability: $100,000 and up
– E & O: $250,000 and up
– Zurich’s Supply Chain Insurance: up to $100 Million
• Typical deductibles – retention has been increasing among larger companies
– Cargo Liability: $5,000 and up
– E & O: $25,000 and up
– Supply Chain: 10% of limit
![Page 33: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/33.jpg)
From Factory to Shelf Insurance Solutions
Importer/Shipper Cargo Insurance
Customs Bonds
Supply Chain
Consolidator/NVOCC Cargo Liability for bill of lading,
warehouse receipt, etc.
Customs Broker Customs Bonds
Factory/Warehouse/DC Property/Casualty/W.C.
Include Completed Ops
Bailee Liability
Warehouse Contents / storage
“Pick & Pack”
Foreign Ports/Terminal Operators
Workers Compensation
Stevedores Liability
Terminal Operators Liability
Property/GL
US Ports/Terminal Operations US L & H
Stevedores Liability
Terminal Operators Liability
Property/GL
Freight Forwarders Shipper’s Interest/Cargo Insurance
(transferable)
Cargo Liability
Bailee Liability
Professional Liability
Motor Truck Cargo Liability
Warehouse Legal Liability
Ocean Carrier Hull & P & I
Sometime Cargo Insurance
Trucking Companies
Rail Lines Motor Truck Cargo Liability
Shipper’s Interest/Cargo Insurance
Bailee Liability
![Page 34: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/34.jpg)
34
Cargo Insurance “Shipper’s Interest” vs. Cargo Liability
Shipper’s Interest
Must have an insurable interest
Terms of Sale
By written contract - Logistics company can demonstrate insurable interest through letter or contract with written instructions to insure from client
Named insured is shipper/owner of merchandise
Common Policy Terms
Limit of Insurance
Geographical Territory
Valuation
Insuring Terms
“All Risks”
“Named Perils”
Duration of Coverage – warehouse to warehouse, until delivered, including interruptions in transit that are beyond the control of the shipper (port delays, deviations, etc.)
Basis of Premium Collection
Cargo Liability
Protects carrier for loss or damage to merchandise of others
Common Carrier Liability
– Carmack Amendment
– Contract Carrier Liability
Named insured is carrier
Common Policy Terms
– Limit of Liability
– Geographical Territory
– Valuation
– Insuring Terms – Broad Form
– Common Exclusions
– Duration of Coverage
Basis of Premium Collection
![Page 35: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/35.jpg)
35
E & O Insurance Overview
• Covers consequential or financial loss suffered by the shipper as a result of the carriers negligence, error or mistake
• Exposure
– No standard international limits of liability
– Risk from errors or mistakes such as:
• Freight delay due to negligence
• Lost or stolen freight
• Improperly completed documentation
• Negligent selection of an airline, carrier, packer, sub-contractor
– Legal fees can be costly
![Page 36: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/36.jpg)
36
Cargo Liability Package Programs
• Liability for loss or damage to cargo
• Liability for errors and omissions
• Third party liabilities
• Fines for regulatory breach, i.e. customs, pollution and safety at work
• Costs including misdirection, investigation defense, disposal and mitigation
• Coverages may include cargo liability, air liability, motor truck cargo liability, warehouse liability, packing liability, specific contractual liability
![Page 37: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/37.jpg)
Earlier in this webinar, mention was made of Supply Chain Management. Can you explain what this entails and why it is important?
Linda Conrad, Director of Strategic Business Risk Management, Zurich
Dave Bradford- Advisen Ltd.
Robert DeMotta, U.S. Practice Leader- Marine, Aon Risk Solutions
Patrick Hickey, Vice President- Cargo, Zurich Global Corporate
Barbara Spain, Senior Vice President, National Logistics Manager- Marine, Aon Risk Solutions
Anthony J. Ten-Barge, Director of Risk Management, Genco
![Page 38: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/38.jpg)
Supply Chain is Everywhere – So Many Opportunities!
![Page 39: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/39.jpg)
• High Tech & Electronics • Consumer Products • Automotive & Transport Equipment • Food & Beverage • Life Sciences, Pharma & Healthcare • Industrial Manufacturing • Retail • Chemical
Source: 2010 15 Annual Third-Party Logistics Study/CSCMP
Key Industries with Supply Chain Concerns
![Page 40: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/40.jpg)
What are some of the Risk Management issues and concerns with Supply Chain management?
Linda Conrad, Director of Strategic Business Risk Management, Zurich
Dave Bradford- Advisen Ltd.
Robert DeMotta, U.S. Practice Leader- Marine, Aon Risk Solutions
Patrick Hickey, Vice President- Cargo, Zurich Global Corporate
Barbara Spain, Senior Vice President, National Logistics Manager- Marine, Aon Risk Solutions
Anthony J. Ten-Barge, Director of Risk Management, Genco
![Page 41: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/41.jpg)
Operational Risk Management
Risk Management
Operations Contracts
New Business
Development
Transportation
Real Estate
Legal
Tax
Regulatory Finance International
Environmental Management
Health & Safety
Training
Data Management
IT
Human Resources
Business Development
41
![Page 42: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/42.jpg)
Operational Risk Management
The
Supply
Chain
42
![Page 43: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/43.jpg)
Operational Risk Management
• Physical Property Risk
• Cargo Risk
• Business Interruption Risk
• Trade Credit Risk
• Political Risk
• Supply Chain Risk
43
![Page 44: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/44.jpg)
Supply Chain Risk Events
Manufacturing
Manufacturing
Raw MaterialInventory
Manufacturing
Raw MaterialInventory
Supplier
Supplier
Supplier
Supplier
Warehouse
Warehouse
Packaging
Earnings Per Share
Free Cash Flow
Distributionand Sales
Event
Excess Capacity
Re
rou
te
Unexpected Loss
Safety
Stock
At Capacity
Re
rou
te
Net Decrease in
Production
![Page 45: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/45.jpg)
• Difficulty obtaining information about affected Suppliers and the extent of damage
• What caused the damage? Insured Peril?
– Earthquake
– Tsunami – (How is tsunami defined? Flood or Earthquake)
– Power outage
– Nuclear exposure / threat
– Prevention of Access
• Definition of Occurrence – Continuous 72-hour limitation vs. Aftershocks weeks or months later
• Territorial limits – Japan specifically excluded
• What is the impact upon US companies?
Issues Arising From Japan Earthquake
![Page 46: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/46.jpg)
What are some of the Risk Transfer Solutions for supply chain?
Linda Conrad, Director of Strategic Business Risk Management, Zurich
Dave Bradford- Advisen Ltd.
Robert DeMotta, U.S. Practice Leader- Marine, Aon Risk Solutions
Patrick Hickey, Vice President- Cargo, Zurich Global Corporate
Barbara Spain, Senior Vice President, National Logistics Manager- Marine, Aon Risk Solutions
Anthony J. Ten-Barge, Director of Risk Management, Genco
![Page 47: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/47.jpg)
47
Credit Risks
Protracted Default
Insolvency
Losses due to Payment Default
Political Risks
Contract Frustration
Expropriation etc.
Property/ Business Interruption
Mobile Assets (Stocks & CCP)
Fixed Investment (Equity)
Corporate Loans Lenders Interest
Project Finance (Equity & Debt)
Asset Risk Sovereign Contractual Default
Catastrophic Perils
Supply Chain
Other Perils
Physical Loss or Damage
Global Logistics
Transportation Perils
Customs
Physical Loss or Damage
Supply Chain or Trade Disruption
Trade Disruption: Political and/or natural disasters perils that prevent the delivery of key equipment or supplies.
Reimburse extra expenses and lost profits
Potential Risk Transfer Solutions
Supply Chain: 'all risk' supply chain cover with a pre-agreed claims methodology from Zurich
![Page 48: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/48.jpg)
Reduced fluctuations in results
No physical peril required
Protect balance sheet, brand & reputation
Informed decision making
Protecting profitability and balance sheet funding
Can cover delay costs
Increase transparency
SC13(V2)Jul/05/10GC/ZCA
![Page 49: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/49.jpg)
Supply Chain Insurance
Covering risks not covered by other insurance products
SC16(V2)Jul/05/10GC/ZCA
![Page 50: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/50.jpg)
How does one assess their Supply Chain Risk
Linda Conrad, Director of Strategic Business Risk Management, Zurich
Dave Bradford- Advisen Ltd.
Robert DeMotta, U.S. Practice Leader- Marine, Aon Risk Solutions
Patrick Hickey, Vice President- Cargo, Zurich Global Corporate
Barbara Spain, Senior Vice President, National Logistics Manager- Marine, Aon Risk Solutions
Anthony J. Ten-Barge, Director of Risk Management, Genco
![Page 51: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/51.jpg)
SC6(V3)Jul/05/10GC/ZCA
Supply chain disruptions are more frequent
BCI survey over 300 companies responded
number of supply disruptions per company per year
BCI/Zurich survey over 500 companies
Number of supply disruptions per company per year
Over 50% had more than one disruption
Over 85% suffered a supply disruption in 2011
![Page 52: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/52.jpg)
Identify vulnerabilities
Quantify and benchmark risk exposures
Prioritize mitigation actions
Informed decision making
Understanding where and how your supply chain could be vulnerable
Support operational profitability
SC10(V1)Jul/05/10GC/ZCA
![Page 53: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/53.jpg)
53
Zurich’s family of Supply Chain risk tools
Risk understanding
Total Risk Profiling
Risk Room
NatCat -Location risk
Profit risk exposure
Disruption understanding
Business interruption analysis
Risk assessment
Provides macro country insights, e.g. political stability, economic status, labour situation
Provides exposure information for supplier locations in respect of e.g. floods, earthquakes, windstorm, related transport infrastructure
Helps in the understanding of the level and nature of disruptions in the particular industry or a particular location from a unique database
Enables a company to understand its total supply chain profit exposure in terms of a particular location, country or region
Helps a company model its relevant BI exposures
Formalised assessment of relevant areas which are part
of the due diligence process within the sourcing activity
Structured approach to defining risk appetite and
prioritisation for dealing with risks in the supply chain
![Page 54: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/54.jpg)
54 54
Business Interruption Analysis
Helps a client model their relevant BI & CBI exposures.
![Page 55: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/55.jpg)
Q&A
Linda Conrad, Director of Strategic Business Risk Management, Zurich
Dave Bradford- Advisen Ltd.
Robert DeMotta, U.S. Practice Leader- Marine, Aon Risk Solutions
Patrick Hickey, Vice President- Cargo, Zurich Global Corporate
Barbara Spain, Senior Vice President, National Logistics Manager- Marine, Aon Risk Solutions
Anthony J. Ten-Barge, Director of Risk Management, Genco
![Page 56: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/56.jpg)
Many Thanks to our Sponsor!
![Page 57: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/57.jpg)
Barbara Spain, Senior Vice President, National Logistics Manager- Marine, Aon Risk Solutions. Email: [email protected]
Patrick Hickey, Vice President- Cargo, Zurich Global Corporate. Email: [email protected]
Robert DeMotta, U.S. Practice Leader- Marine, Aon Risk Solutions. Email: [email protected]
Linda Conrad, Director of Strategic Business Risk Management, Zurich. Email: [email protected]
Anthony J. Ten-Barge, Director of Risk Management, Genco. Email: [email protected]
Thank you Panelists
![Page 58: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/58.jpg)
58
White Paper: Available on Advisen’s Corner Store
![Page 59: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/59.jpg)
59
Upcoming Advisen Webinars
Visit http://corner.advisen.com/advisen_webinars.html for the 2012 Webinar Schedule
The Emerging Health Care Risk Landscape
Thursday, December 6, 2012 at 2pm EST
Social Hackitvism
Tuesday, December 11, 2012 at 11am EST
![Page 60: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/60.jpg)
60
Upcoming Advisen Conferences
Visit http://corner.advisen.com/advisen_conference.html for the 2012
Webinar Schedule
Date: Thursday, January 31, 2:00 PM EST
https://advisen.omnovia.com/register/41841336591883
![Page 61: Emerging Risks in Marine Transportation Webinar...forms of marine liability. Through his knowledge of the marine insurance market, Bob has helped lead Aon in the development of new](https://reader033.vdocuments.us/reader033/viewer/2022060320/5f0d17147e708231d438a163/html5/thumbnails/61.jpg)
61
How to reach us: Advisen Ltd.
1430 Broadway
8th Floor
New York, NY 10018
www.advisen.com
Voice: +1.212.897.4800
Fax: +1.212.972.3999