Supply Chains Stressed in 2011

Companies face complex risks and costlier insurance.

John Dempsey of Dempsey Partners John Dempsey of Dempsey Partners

As supply chains stretch out longer and longer, they seem to be snapping more often. And while companies generally insure against such risks, the standard insurance product, contingent business interruption coverage, has some shortcomings.

A survey of more than 550 companies worldwide found 85% had experienced at least one supply chain interruption in the last year, up from 72% in 2010 and 74% in 2009. The survey, which was conducted by the Business Continuity Institute and sponsored by Zurich and DHL, also showed that 29% of the companies reported more than one supply chain disruption, up from 20% in 2010.

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