Our unLTD columnist is on his travels – casting his insurance eye on export
Exporting doesn’t have to be scary!
As we begin a new year, where we may or may not be leaving the EU, we are constantly being encouraged to be more outward looking as a country, which as an island nation we have always been.
There is now more support than ever for companies who would like to start their export journey, whether that is with market research, finance, business planning or understanding how to get paid.
If this is something you are considering you may also want to look into the impact on your insurance arrangements, which may seem complicated, but it doesn’t need to be.
The main considerations are split into three broad areas:
Insurance for goods being sent around the world is catered for by the marine cargo insurance market and is based upon the total value of goods being sent during a 12 month period and the maximum value of all goods on any one vessel.
The way the insurance is arranged will depend on the selling terms you negotiate. However, the cover can be included from the moment it leaves your factory right up until it hits your customer’s premises. This would include transport by rail, road, air or sea and will include temporary storage throughout the journey. It would also provide cover for packing and unpacking at various premises along the way if appropriate.
As in the UK you have a liability for any injury or damage caused by your products or services and to your employees.
You will therefore need to ensure that your liability insurances you buy in the UK are with insurers who are comfortable with those same risks in other countries. This will vary greatly depending on where you are planning to export to.
Some countries, such as the USA and Canada, are deemed to be a much higher risk than most others due to the likelihood of claims occurring and also the size of the damages awarded by the courts in those countries.
For this reason you will pay a much higher premium to export to the USA and Canada than you would for sending products to any other country. This also restricts the number of insurers who will be able to provide the cover.
Travelling overseas on business can pose much greater risks to you and your people than doing so in the UK.
Once again the risks posed vary greatly depending on the countries you are considering for export and include:
- Theft or robbery
- Accidental damage or loss of business property
- Personal injury
- Kidnap and ransom
Thankfully all of these risks can be insured against with the appropriate insurers – however the cover can be difficult to obtain if you are travelling to high risk countries. In addition to this, most insurers will not provide cover if you are travelling against foreign office advice.