Manufacturing Industry Insurance: Safeguarding Global Operations

In today’s interconnected world, manufacturers are more connected to the global economy than ever before. Whether you’re selling products overseas, sourcing raw materials internationally, or operating facilities in other countries, these international ventures come with unique risks. To protect your business, you need the right insurance solutions designed specifically for the manufacturing industry.

Managing Global Risks with Manufacturing Industry Insurance

If your manufacturing business operates beyond U.S. borders, you’ll need an insurance program that meets international requirements. This usually means working with a locally admitted and licensed insurance carrier to comply with local laws. Global insurance companies like Chubb and Zurich make this easier with their established networks worldwide. However, partnering with a local broker is often necessary to ensure your coverage meets local standards.

Local policies are designed to follow the rules in each country but might not match up perfectly with the rest of your insurance program. That’s where Difference in Conditions (DIC) coverage comes in. This coverage helps bridge the gaps and keeps everything aligned with your company’s main insurance policies. Additionally, workers' compensation can be complicated in foreign countries, as many have government-regulated programs—this is another area where local brokers can be a big help.

International Policies for Exporting and Traveling Employees

If your company mainly exports products or occasionally sends employees abroad, an international policy might be the right fit. These policies are flexible, letting you pick the coverage that makes the most sense for your business. However, it’s good to know a few things upfront:

• Worldwide Coverage Limitations: General liability policies that claim to cover worldwide incidents typically only respond if a lawsuit is filed in the U.S. An international policy covers lawsuits filed outside of the U.S., but keep in mind that these policies usually reimburse expenses rather than paying them directly.
• Medical Coverage Considerations: Medical coverage under these policies is typically limited and meant to supplement U.S. workers' compensation. If employees need more comprehensive medical care abroad, make sure your policy covers those needs.
• Repatriation Costs: If an employee is injured or passes away abroad, repatriation coverage pays for getting them back home. Make sure your policy limit is sufficient for this.
• Service Capability Matters: When choosing international insurance, consider the carrier’s service capabilities to ensure they can support your business wherever you operate.

Political Risk Insurance: Protecting Your Global Investments

Manufacturers with significant investments in other countries face risks like asset seizure, political violence, or economic sanctions. Recent geopolitical issues, like the conflict in Russia, have shown how important political risk insurance can be. This type of coverage protects against events like:

• Expropriation or Nationalization: When a foreign government takes control of private property.
• Forced Divestiture: Being required to sell off assets due to political changes.
• Currency Restrictions: Inability to convert foreign currency or restrictions on transferring money.
• Political Violence: Property damage or loss due to war, terrorism, or civil unrest.
• Breach of Contract or License Cancellation: When a foreign government breaks a contract or cancels a license unexpectedly.

Since political risk insurance isn’t standardized, coverage details vary by provider. Review policy exclusions carefully to understand which countries or scenarios might not be covered.

Accounts Receivable Insurance: Securing International Payments

One of the biggest challenges of international trade is ensuring you get paid. Accounts receivable insurance protects your company if a foreign customer doesn’t pay. This coverage is offered by specialized insurance companies and agencies like the Export-Import Bank of the United States.

Manufacturing Industry Insurance Solutions with Wells Insurance

Protecting your business in the global marketplace is complicated, but it doesn’t have to be overwhelming. At Wells Insurance, we understand the unique challenges manufacturers face worldwide. Don’t leave your business exposed to unnecessary risks. Contact us today to schedule a consultation and discover how our tailored insurance solutions can safeguard your international operations. Take the first step toward protecting your manufacturing business and gaining peace of mind.