Look to the supply chain for insurance inspiration

The insurance community is generally happy about the way that port operators themselves have reacted to the recession by resisting temptation to slash training and manning; but it is worth noting the recent remarks of Paul Hopkin, technical director of the Association of Insurance and Risk Managers (Airmic).

Mr Hopkin told a meeting that in parts of the supply chain, the pendulum had swung from “lowest risk at any cost to lowest cost at any risk”, although thankfully the feeling is that it is just beginning to swing back. Grant Foster of broking group Aon told the same event that many companies that were too cavalier about risk “are no longer here: a risk management equivalent of natural selection”.

The fact that Airmic, in conjunction with Aon and underwriters ACE felt the need to host a gathering on supply chain risk highlighted that business continuity remains an urgent topic.

Globalisation requires ports to transform their view of their role – a transformation yet to be fully accomplished, concluded a United Nations report four years ago on Asian ports, and that remains valid in some cases. It is the performance of all the elements of the chain in meeting the needs of customers, not just the performance of facilities within the port, that will determine the path that freight will take.

One ready means of keeping tabs on what is happening on the broader scale is via the insurance market, an often underestimated repository of information. As well as making available suitable liability and property packages for ports, the market has become more adept at gauging risk factors further along the transport chain.

At the same time, there is no hiding behind multimodalism, for ports are viewed by the public as having a distinctive role, and have to be accountable in terms of corporate social responsibility and environmental concerns. Underwriters and brokers have taken on the mantle of being valuable allies in helping ports adjust to the new era.