As strikes and intimidation
become the favoured
‘quick-fix’ for workers
dissatisfied with their wage
levels, freight operators as
well as farmers and exporters
would do well to take a fresh
look at insurance solutions to
cover these risks, says Bimesh
Ugarchund, director Eikos Risk
Applications.
“But in seeking the
appropriate solutions and
covers, it’s also become crucial
to understand one’s cover
and what is available,” says
Ugarchund. “Everyone checks
their policy for the applicable
‘strikes clauses’ that provide
cover against physical losses and
damage caused by strikers.
“But clients don’t take the time
to educate themselves about the
limitations of these clauses,” says
Ugarchund, “especially as they
relate to refrigerated goods.”
These clauses typically provide
cover against material damage
as a direct result of strikers’
actions, he explains. “But let’s
say the strike happens at port
and the port authorities lock
up the port. Your products may
deteriorate simply because they
suffer temperature variations
(containers were not plugged
in) or because they cannot be
shipped and are delayed for
an inordinate amount of time.
The strikes clauses won’t cover
you against this, which is why
exporters and farmers must be
aware of what they can and can’t
recover from their policy.”
Ugarchund urges exporters
and freight operators to also
invest in Sasria cover (South
African Special Risks Insurance
Association). “Again, be aware
of the limitations of this cover.
It only responds to material
damages arising from labour
action like strikes, lock-outs
and politically motivated riots,
civil unrest and terrorism within
South Africa. The onus is on
the policy-holder to prove the
claim to the insurer – and this
can become quite technical,”
he added. Exporters and freight
operators are encouraged to
purchase Sasria cover for both
the shipping of products as well
as the business assets, he said.
Farm workers and truck drivers
are both links in the supply
chain, and the tiniest break in
this chain creates a domino effect
that’s felt throughout the chain.
It’s important to think proactively
about strike action through the
chain and develop business
continuity and contingency plans
for this eventuality, he says.
“Without sound risk management
and the proper insurance
solutions, exporters, freight
operators and other service
providers in the chain will suffer
the consequences.”
CAPTION
Bimesh Ugarchund … ‘Crucial to
understand one’s cover and what is
available.’
