As restrictions ease and business activities resume, adjustments need to made
The Covid-19 environment is stimulating changes across the transport sector, raising new issues for consideration and factoring into your business continuity and risk management plans.
Now is the time to review your insurance cover to ensure you’re protected.
Start by looking at these key areas.
Inter-state biosecurity and quarantinable acts legislation – stricter controls are likely to be introduced governing the movement of goods across Australia and internationally, which may lead to delays caused by incomplete paperwork or the need to respond to a changing regulatory landscape.
Supply chain impact and disruption – distribution delays, cancelled orders and shifting demand for domestic and imported goods may cause peaks and troughs in demand, and disruption to ports and freight terminals.
Warehousing and distribution – the expected economic downturn in employment rates may provide access to an additional labour pool.
Road freight/trucking – capacity is high, meaning that rates are likely to be low. Fuel prices are likely to remain below recent averages.
Shipping, marine and cargo industry – volumes are expected to drop by up to 20 per cent. Shipping volumes will fall in the short-term due to international order cancellations and shifts in consumer demand.
Air passenger services – although capacity will gradually lift, fluctuating demand will impact air cargo rates.
STAY PROTECTED
Whether your cover applies to your business assets, employees, clients and customers or members of the general public, core insurance remains vital to the ongoing protection of your business.
When assessing cash flow and business continuity, some businesses may opt to reduce limits, adjust the breadth or scope of cover, or otherwise cancel insurance cover altogether. Before taking these steps you need to understand the impact of these decisions.
Review any mid-term adjustments to current levels of insurance cover.
Options, such as laid-up cover in commercial vehicle policies, are available to insure trucks taken out of service in certain circumstances.
Update standard working practices to mitigate any risk to driver and employee health and safety.
This includes following social distancing guidelines when working with suppliers, customers and co-workers.
Review any contractual obligations to cover delays to the transportation and delivery of goods in terms of late delivery, port and terminal charges with respect to any event likely to trigger an insurance claim that requires insurer notification within a specified time period.
Read Roz Shaw’s take on issues surrounding management liability cover, here
Enforce strict hygiene controls and in-cab sanitisation with particular focus on the areas that are in regular contact (door handles, dashboard and door switches, gear stick, etc.). Use of air conditioning sanitiser on a weekly basis is also recommended.
Monitor state and federal government alerts via releases on their websites to keep across important legislative and regulatory changes and updates on economic and financial stimulus packages available. Safe Work Australia has published guidelines for the road freight and warehousing and logistics industries.
You should contact your insurance broker if any of the following scenarios apply to your business:
- reducing insurance cover – if you have made, or are considering making, changes to your insurance cover, including limits of liability
- the scope of business activity changes, including moving functions and remote working arrangements
- cash flow concerns that are likely to impact your ability to continue trading and/or require structuralchanges to your business operation.
Your broker can help you navigate the current period of change, disruption and uncertainty, and ensure you maintain adequate (and appropriate) levels of insurance cover.
Download the full version of the Gallagher Transport Industry Risk Update Covid-19 Considerations document at: https://bit.ly/2BvRllT.
Roz Shaw spent 30 years at her family’s transport business before moving into insurance at broker Gallagher