Preparing for a major food & agri claim

04 September 2018

Who doesn't like a pleasant surprise? But nasty surprises can be a nightmare and this is all too often the case when it comes to large loss insurance claims.

Businesses in the food and agri sector are meticulous about their proposition. They would never launch a new product or service without first testing it extensively. Why, therefore, do so many companies not stress-test their insurance programmes before they ever have to make a claim?


It seems simple. A loss happens and there’s a set process to follow. Notification, investigation, quantification, validation and then settlement. But there’s no set timeline for each of these stages and claims can get stuck at one of them.

Who should you notify in the event of a claim? Your broker and insurer need to know, but what about customers, suppliers, loss assessors, government bodies and regulators? Who does this?

When and how? What detail do they have to provide and who collates that information?

Investigating a large loss is rarely simplistic and, again, there are lots of stakeholders involved. Similarly, there can be disagreements and lengthy negotiations over liability, insurance coverage and the final settlement figure.


Robust pre-loss planning will help you avoid the headless chicken scenario. The last thing you want to be doing is running around in circles when the fastest way to a settlement is in a straight line.

Pre-loss planning will prevent you from wasting time and increasing the impact of a loss on your business. That’s a worthwhile benefit in itself.

But planning will also let you determine the scope of your coverage and whether your insurance will respond when you need it to. As a result, you’ll be able to see if you’re getting the protection and value you need from your policies.


To establish the correct plans and protocols to follow in the event of a claim, you’ve got to work out what scenarios you might face. Whether it’s a fire, a flood, an earthquake or a major product recall, what exposures do you face?

Once you’ve outlined potential loss scenarios, you can then stress-test your insurance programme. Would these events trigger coverage? Where are the gaps? What losses would remain on your balance sheet? How do you mitigate these losses and reserve for what’s left?

In the event of a claim, a swift, consistent and considered response is essential in moving things forward effectively. Who has responsibility for what actions? Is operational, financial and regulatory data kept in the format required? Is it accessible?

It’s also imperative to work collaboratively with brokers and insurers during a claim. If you make decisions independently, adjusters and insurers may question whether they resulted in best value. Potentially they may not cover all the costs involved in enacting a decision they had no part in.

Outlining how you will work with all involved stakeholders, how decisions will be made and how the process is documented is a major aspect of claims preparation. It will minimise disputes and should reduce the overall time to settlement.

The bottom line is that it’s up to you to present your claim accurately and to demonstrate the scale of your loss. If you’re running around like a headless chicken, then you’re unlikely to get a quick and complete settlement.


  • Don’t believe it won’t happen: plan for if it does happen
  • Stress-test your insurance programme
  • Work collaboratively with brokers, insurers and all other stakeholders.

For more information contact Candy Holland, Managing Director for Echelon Claims Consultants on +44 (0)20 7558 3230