Lockton teams up with CreditorWatch to release toolkit
Lockton teams up with CreditorWatch to release toolkit | Insurance Business Australia
Insurance News
Lockton teams up with CreditorWatch to release toolkit
Partnership to help credit managers
Insurance News
By
Roxanne Libatique
Insurance broker Lockton teamed up with data company CreditorWatch to launch the Credit Manager Risk Toolkit.
The toolkit delves into the evolving role of credit managers and some of the risks they are not paying enough attention to, including rising shortcomings in business interruption insurance, risk of customer contract penalties, third parties failing to deliver or suffering a breach, and data shared between external vendors becoming exposed to cyberattacks.
The toolkit also includes key considerations and suggestions as to how credit managers can respond to risks and insights from CreditorWatch chief economist Anneke Thomson and director Ali Zoabi on these matters.
Supply chain risks
Focusing on supply chain risks, the Credit Manager Risk Toolkit noted the increasing number of shortcomings in BI insurance, increasing customer/supplier bankruptcy and defaults, and companies making ESG statements becoming exposed to risks from failures or bad behaviour by key suppliers or customers.
The authors advised credit managers to focus on the following:
business continuity plan, which is likely out of date if it has not been tested for over two or three year
insurance cover, which could be out of date and presents a sleeping critical risks if or when a major claim happens
modern slavery
Economic risks
The authors reminded credit managers to focus on economic risks, including risk of customer contract penalties, underinsured assets, and out-of-date insurance cover. They also advised credit managers to consider the following business and insurance impacts:
inflation, interest rates, and supply chain disruptions
costs and cover amendments to insurance
increased insolvencies and late payments
Cyber security and technology risks
The toolkit emphasised that if a third party fails to deliver or suffers a breach, the organisation using the vendor will face the consequences. It further reminded credit managers that:
data shared between external vendors can be exposed
cloud and API exposures can result in the loss of valuable information from an organisation’s database
useful technology such as AI could have unforeseen risks
using data analytics must be carefully managed
The toolkit also emphasised that inflation should not hinder organisations from investing in cybersecurity.
Geo-political risks
Focusing on geopolitical risks, the toolkit advised credit managers to focus on loss of profit following an insured property damage event, lead times on critical supplies taking longer to source or transport, and additional costs incurred post-loss to maintain supply or continue customer service.
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