Specialty Lloyd’s re/insurer Beazley has announced a partnership with Tokio Marine Kiln and RenaissanceRe that aims to provide unique and flexible solutions for reputation risk.
Custodian Consortium is designed to protect clients throughout the lifespan of a crisis by providing crisis management expertise and substantial loss-of-profits cover, to protect companies after a significant downturn in revenue.
With underwriters’ consent, an event that threatens major reputational damage may entitle the client to crisis management advice worth up to $1 million.
Beazley says the first $250,000 of this cover is available on a pre-loss basis, regardless of whether a loss of revenue is ultimately recorded.
Business interruption cover is triggered by a drop in revenue that has been pre-agreed at policy inception.
Because organisations can rarely predict what might trigger a reputational crisis, the policy works on all-risks basis.
It therefore covers many potential scenarios that could affect different sectors, from allegations of sexual harassment or bullying against a senior executive, or the mismanagement of such claims, to faulty or misused medical equipment.
The cover is available to US-domiciled organisations of all sizes, specifically targeting companies with up to $5 billion in revenue, including both public and private companies, and for-profit and not-for-profit enterprises.
“In an era in which news travels faster through social media, risk to hard-earned reputations is greater than ever before,” said Rachel Turk, focus group leader of Beazley’s London-based D&O team.
“Preparedness and speed of response are critical. Our policy has been designed to ensure that crisis response expertise is available, backed by the necessary funds, as soon as an incident occurs.”
“By pre-agreeing the level of revenue drop that will trigger a claim at the outset with our underwriters, clients can be sure that no time will be lost in providing cover that meets their requirements, and generally without the need for loss adjustment.”
In the event of a crisis, clients will be supported by highly regarded crisis management advisory firms, APCO Worldwide and CrisisRisk.