The lower value of the pound should make our exports more attractive. It is a central plank of economic policy that as the role of the public sector is reduced; the slack is taken up by private enterprise. This can only be achieved by substituting imported goods by those manufactured in the UK or by exporting more. The value of the pound should help but for many smaller companies exporting can be a hassle with lots of red tape. One of the issues that should be considered is the insurance implications of selling goods and services abroad. This can easily be resolved by contacting us. There are three areas which normally need consideration:

• Cover for the goods, and samples, equipment which may be used overseas or exhibitions attended. The requirements depend on your terms of trade but cover can easily be arranged on goods to dovetail in with these. It is normally best for you to organise the cover rather than let the customer or freight company do this, as you then have the comfort of knowing it is within your control.
• Directors and staff need protecting whilst abroad. An annual business travel policy can be arranged to cover medical expenses, luggage, cancellation, replacement of staff etc. There are specific policies designed for the business traveller. In special circumstances, kidnap and ransom cover may be advisable.
• You need to be sure your liability covers are adequate. If you are working abroad special covers will be needed and exports to certain areas such as North America require special consideration. Insurance costs can increase substantially as litigation is extremely costly and court awards much higher.

We are very experienced in arranging insurance for companies which export goods and services and can often help in making the entire process much easier and in the end less costly. Call Gary Holland or Tom Butler on 0113 250 0377 for a discussion to assess your needs and requirements. Back to news

More customers are demanding details of environmental policy from suppliers

Many businesses are finding they need to manage a wide variety of issues, many of which have an environmental context. Legislation such as Packaging Regulations, Environmental Permitting Regulations, the landfill tax, and VOC (Volatile Organic Compounds) should all be considered. In addition, there is an increasing need to demonstrate environmental awareness to customers who may be demanding your environmental policy, proof of audits, or information about how you manage the environmental aspects of your business, as well as to satisfy the regulators or your insurer. The best way of managing this process is by having and implementing an overall strategy for managing environmental matters. This is known as an Environmental Management System (EMS), bringing together all the relevant issues in a single strategic plan. There are currently a number of environmental management standards for which, external certification is available:

• ISO 14001:2004
• EMAS (the European Eco-Management and Audit Scheme)
• BS 8555:2003

It may be worth investigating these for adoption in your business. As a first step, organisations should carry out a review of their activities which affect (or could affect) the environment. These may be:

• Regulatory, involving for example, waste disposal, emissions to atmosphere or discharges to water through drains or effluent
• Resource issues such as raw materials sourcing; water or energy use
• Neighbourhood issues such as noise or transport

The review will highlight useful areas of environmental gain as well as those areas which require positive management to minimise risks. Suggested Steps

• Review how your business affects the environment
• Make sure you know what legislation is relevant to you
• Examine your use of resources
• Develop an environmental policy
• Develop procedures for key environmental tasks utilising best practice
• Set objectives for environmental improvement
• Carry out training for those people who carry out tasks which affect the environment
• Audit and review progress
• Make progress review reports available to stakeholders

Demonstrating your commitment to the environment is fast becoming a business necessity and is a feature of winning new contracts. Customers want to be assured that the environment is not overlooked and that environment is integrated into the management philosophy. EMS can help you reduce environmental risk by identifying weak spots and managing key issues. It will help you to identify areas for savings and may help you to avoid making expensive mistakes. It is also a requirement of insurers for some businesses where the risks are high for full cover to be granted. There are companies who can help in producing an EMS and if you want a contact name please ring Tom Butler on 0113 202 1227.

The problems encountered by Toyota regarding defective brakes and accelerators highlight a problem many businesses face. The recall is estimated to cost well over £1bn and to be added to this, is the management time in dealing with the crisis, the damage to its reputation, the costs of rebuilding this and the impact on future sales. When the final costs are counted, it will probably be over £2bn. Toyota will be looking to offset some of these costs by claiming against the suppliers of the defective parts. Few companies can survive such a financial hit and although, not on the same scale, many businesses could find themselves in a similar position. Conventional insurance policies do not cover the types of costs incurred by Toyota and the risks of recalls are rising all the time because of the growing impact of media on safety conscious and consumer issues. As soon as a product is recognised as being faulty, businesses face the dilemma of leaving it in the market or undertaking an expensive recall. The first inclination is to keep quiet and hope the problem does not become serious but if the defect is safety critical, major problems can emerge. Insurers could refuse to pay out for any injury or damage caused, huge fines can be imposed, directors would be sued and in the worse case, even sent to prison for health and safety breaches or corporate manslaughter; the risks are too high for anyone other than the desperate. The situation is exacerbated in that a large part of manufacturing is now done in the Far East especially China. If their goods are defective, attempts would normally be made to recover the costs. This is virtually impossible especially against a Chinese company with no assets in the UK. The only hope is to sue the UK importer if there is one. These are unlikely to have the appropriate insurance, so the chances of recovery is very low, this scenario leaves the UK business shouldering the burden themselves with little prospect of recovery. Insurance against the financial risks of recall is available. It is a small market and cover can be costly but should be considered by businesses that manufacture or import consumer goods or parts or materials to be used in these. Please contact us on 0113 250 0377 if you would like further discussions. Please speak to Mohammed Taj or Chris Corkery on 0113 250 0377 for a quotation.