Two Ways Manufacturing Insurance Rates are Affected by the Environment
Environmental changes due to climate change are reshaping the world as we know it. In fact, the overwhelming majority of experts agree that climate change is to blame for the uptick in extreme and unpredictable weather events. This, in turn, has lowered carriers appetite for risk. It has also led to increasing scrutiny in the underwriting process. The manufacturing industry is one industry where the environment has a big impact on insurance rates and renewals. Here’s how:
Extreme cold weather conditions can disrupt logistics, damage equipment, and ruin key infrastructure. It also limits workers’ dexterity and may increase the probability for an accident that results in a workers’ compensation claim.
High humidity, often a byproduct of intense storms and flooding, can damage packaging, storage, buildings, equipment, and even the final product. In addition, electronic components can get ruined and cardboard can develop mold.
The Affect on Manufacturing Insurance Rates & Renewals
An increase in claims and loss events usually leads to higher rates at renewal. That’s why it’s so important to have an experienced Insurance Advisor to help safeguard your supply chain against the environment. Plus, they will be able to help tell your story to underwriters and make sure you get “top of stack” treatment.
We’ve only covered two ways the environment affects manufacturing insurance rates and renewals in this post. However, we’ve identified four other ways in our resource, Six Ways the Environment Affects Manufacturing Insurance Rates and Renewals.
Contact Burnham WGB Commercial Risk Advisors
The manufacturing industry faces pressure from many directions. In fact, environmental factors are just one area of exposure you’ll need to mitigate. The good news? You aren’t alone. Learn more about our Commercial Risk Management Team for help navigating the complexities of insurance and risk management in a hard market. Or, feel free to contact us directly.