Top Ten risks to consider when ‘Going Global’
PATHWAY FOR GROWTH – YOUR INTERNATIONAL INSURANCE RISKS EXPOSED AND PROTECTED
Many SMEs will be poised to take advantage of the export market post BREXIT. With potentially greater access to international markets and more demand expected from overseas, due to favourable conversion rates, planning a ‘Pathway for Growth’ can enable SMEs to become the multinationals of the future.
Understanding International Markets
Emerging multinational companies looking to trade abroad should ensure they have an insurance and risk management solution that can support their business through a cost-effective programme capable of sustaining and reinstating any commercial endeavours effectively, in the event of a loss. However, to achieve this, businesses need a solid understanding of the landscape of their chosen market overseas to provide assurance that their insurance purchases will fully deliver and protect all their assets and liabilities, at home and abroad.
The international insurance market is complex. Regulations differ in each country and are constantly changing. Navigating these shifting conditions is not easy andbusinesses need to be sure insurance cover meets all legal and commercial requirements, so must ask the right questions of their insurance broker. For example, does your current product liability insurance extend to international markets? Does your goods-in-transit insurance cover your products right up to the point of delivery, or does it end as soon as the goods hit the tarmac overseas?
Dealing with unfamiliar customers abroad, where it might be more difficult to carry out due diligence, can also throw up some challenges. Businesses might need to ensure they have they have the right level of credit insurance to protect them against the failure of a customer (the buyer) to pay for the products/services that have been delivered, or even cancellation of the contract. Consideration should be given not only to the creditworthiness of the customer, but also the country risk of the buyer and the likelihood of sanctions having an impact on trade and payments.
For companies starting on their journey of exporting or trading abroad, setting up a programme of insurance protection can seem like a daunting path. Here are the top ten risks businesses should consider when planning their pathway for international expansion:
• Income loss from shutdown of key offshore facilities
• Dependencies on worldwide partners and suppliers
• Product loss at critical locations
• Unfavorable tax and related penalties due to non-admitted coverage
• Under/Uninsured foreign claims
• Kidnap & ransom and political violence
• International travel risks
• Loss of foreign royalties
• Political risks
• Directors & Officers liabilities
Arthur J. Gallagher’s expertise can navigate you through the complexities of international and credit insurance. If you want to know more, visit our team on stand number 2550 or pre-book an appointment by emailing firstname.lastname@example.org.