Allianz’ corporate insurance carrier, Allianz Global Corporate & Specialty (AGCS), has launched a new solution for the UK automotive industry aimed at covering costs associated with product recalls.
AGCS’ new UK Automotive Component Parts Product Recall cover offers its customers crisis-management assistance services provided by partner company, WorldAware.
The new coverage is designed to address the evolution of the automotive industry and the migration from the manufacturing of individual mechanical parts to the integration of electrical systems, software and new technologically advanced components that interact with one another.
A recent report by Allianz, analysing 367 insurance industry product recall claims from 28 countries across 12 industry sectors, found that automotive recalls account for over 70% of the value of all losses analysed.
This, the report found, is driven by factors such as more complex engineering, reduced product testing times, outsourcing of R&D and increasing cost pressures.
“The automotive industry is undergoing extraordinary change and a rapid transition to new technology,” said Christof Bentele, Head of Global Crisis Management at AGCS.
“Alongside this, closer government regulatory scrutiny as well as increasingly complex global supply chains and growing consumer awareness will only contribute to bigger and more damaging automotive recalls in the future.”
“In this rapidly changing environment it is critical that automotive component manufacturer’s recall insurance policies are ‘fit for purpose’ and tailored to cater for the future risk landscape.”
Initially available within the UK, AGCS says this product will soon make its way North America and Asia.
“Current recall insurance products for automotive component manufacturers are often unclear and fail to address the new and emerging issues faced by today’s modern automotive industry,” added Stewart Eaton, Head of Product Recall at AGCS UK.
“Allianz has been active in automotive recall insurance for over four decades and we have accumulated invaluable experience and data to navigate the many changes to the industry over that time.”
“We’ve now developed a new automotive recall product to offer a clear and simple solution to the emerging risks faced by an industry undergoing radical change. I’m looking forward to sharing it with our clients and partner brokers.”