MS Company is a Trading Company involved in Import and export trade. With various suppliers from Europe and Asia, MS has to keep track of the activities of its suppliers and the entire supply chain. Indeed, MS has to ensure that quality standards and other production standards like occupation safety, labour and human rights are upheld. The shipment process also has its own challenges ranging from damage due to poor handling in shipment containers, loss of goods on transit due to theft or as a result of sea jettisoning practice, and delays in delivery. Considering MS’s internal operations, the company equally has challenges of managing the same. MS has both bonded warehouses and stores with a very large workforce. The employees are a responsibility of MS company. And given that they work in a risky environment and conditions, MS is vulnerable to heavy expenses in form of compensation and life cover for its employees in case these risks become issues or materialize. There’s also need to keep good up-to-date records and developing an up-to-date risk register for proper insurance interventions. In April 2021 as a result of COVID-19 lockdown measures across the world and disruption of port operations particularly in China, MS failed on its deliveries to its clients and as such the clients suffered considerable losses resulting from those delays. The clients are currently claiming compensation from MS management. On another occasion one of MS’s biggest in-land stores was gutted by a very big fire resulting from a careless employee who was smoking on site. MS’s fire extinguishers had expired and the Police fire Brigade did not arrive in time to put out the fire, something that resulted into a very big loss to the Company. MS had insured its store against fire with Trust Insurance Ltd. However, Trust Insurance Ltd has declined to pay for the loss partly claiming that the fire resulted from MS’s negligence and also because MS failed to follow the right procedure while making the claim. Q.1 a) Given the impasse between MS and Trust Insurance Company over an insurance claim, how can the Insurance Regulatory Authority be helpful in resolving the impasse. b) As an insurance student advise MS company on the importance of insurance in supply chain and logistics business
MS Company is a Trading Company involved in Import and export trade. With various suppliers from Europe and Asia, MS has to keep track of the activities of its suppliers and the entire supply chain. Indeed, MS has to ensure that quality standards and other production standards like occupation safety, labour and human rights are upheld. The shipment process also has its own challenges ranging from damage due to poor handling in shipment containers, loss of goods on transit due to theft or as a result of sea jettisoning practice, and delays in delivery.
Considering MS’s internal operations, the company equally has challenges of managing the same. MS has both bonded warehouses and stores with a very large workforce. The employees are a responsibility of MS company. And given that they work in a risky environment and conditions, MS is vulnerable to heavy expenses in form of compensation and life cover for its employees in case these risks become issues or materialize. There’s also need to keep good up-to-date records and developing an up-to-date risk register for proper insurance interventions.
In April 2021 as a result of COVID-19 lockdown measures across the world and disruption of port operations particularly in China, MS failed on its deliveries to its clients and as such the clients suffered considerable losses resulting from those delays. The clients are currently claiming compensation from MS management.
On another occasion one of MS’s biggest in-land stores was gutted by a very big fire resulting from a careless employee who was smoking on site. MS’s fire extinguishers had expired and the Police fire Brigade did not arrive in time to put out the fire, something that resulted into a very big loss to the Company. MS had insured its store against fire with Trust Insurance Ltd. However, Trust Insurance Ltd has declined to pay for the loss partly claiming that the fire resulted from MS’s negligence and also because MS failed to follow the right procedure while making the claim.
Q.1
a) Given the impasse between MS and Trust Insurance Company over an insurance claim, how can the Insurance Regulatory Authority be helpful in resolving the impasse.
b) As an insurance student advise MS company on the importance of insurance in supply chain and logistics business
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