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Procurement Market Intelligence Report

Business Interruption Insurance
Sourcing Guide & Market Trends

Comprehensive intelligence for making smart purchasing decisions

Learn about actual and potential costs

How much should I pay for Business Interruption Insurance?

What is the average price of Business Interruption Insurance?

This procurement report includes pricing information to help you purchase Business Interruption Insurance. Our analysts provide a benchmark price and a price range based on key pricing factors to help you understand what you should be paying for this specific product or service. To see the average price for this and hundreds of other products and services, subscribe to ProcurementIQ.

Has the price of Business Interruption Insurance been rising or falling?

Analysts look at market data from the previous three years to determine an overall price trend. You can use the recent price trends to help you understand price volatility and plan your budget.

I’m not ready to purchase Business Interruption Insurance yet. Will I pay more if I wait too long?

We forecast the next three years of price movements by looking at factors likely to affect the market's supply chain, such as inputs, demand and competition. You can then use the price forecast to figure out the best time to purchase.

What other costs are associated with purchasing Business Interruption Insurance?

Our analysts calculate the total cost of ownership and assign a level of low, moderate or high, depending on things like customization, integration and installation. Use this information to budget for Business Interruption Insurance with a reduced risk of unexpected costs.

See how we display average pricing information, trends and market data.

Find the vendor to meet your needs

Where can I purchase ?

Among the estimated 125 providers of business interruption insurance, the top four players account for less than 30.0% of total market revenue, signaling a low degree of concentration. Low concentration stems from the high degree of homogeneity between business interruption policies, whereby insurers largely offer similar levels of coverage. Therefore,... Subscribe to learn more.

Questions to ask potential suppliers

How can I gain leverage during negotiations?

Experience and Expertise

How long have you provided these products to your longest-tenured client?

What qualifications does your staff have and what measures do you take to keep those qualifications up to date?

What industry do you most commonly supply this product for?

To what extent will ordering multiple products from your firm allow me to save on costs?

What is your repeat business rate for businesses in my industry and how does that compare to your overall rates?

Supply Chain Risk

Over the past three years, what percentage of your revenue has been dedicated to raw input materials? How has that changed?

Has the availability of raw materials tightened due to the coronavirus outbreak?

Over the past three years, what percentage of your revenue has been dedicated to labor?

How have fluctuations in input prices affected the prices of your products during the past three years?

How do you mitigate sudden price increases in raw materials?

When input prices rise, how much of the cost is absorbed by you and how much is passed onto buyers?

How, if at all, has your supply chain been affected by import tariffs levied in 2018?

Regulation

How do you manage regulatory change? Do you have regulation advisers or methods to track regulation?

How have changing regulations influenced your pricing now and how will the changes affect prices over the life our proposed agreement?

What ongoing training procedures do you provide for your staff?

Have you ever been found to be noncompliant with regulatory frameworks?

Amid widespread health concerns during the COVID-19 pandemic, what contingency plans are in place to mitigate risk to your clients and employees? Do you offer clients any flexible exceptions, such as contract suspensions?

Customer Service

How many customer service representatives are available and during what hours?

What has your renewal rate been in the past three years?

How long does it take for an inquiry or amendment and endorsement request to be resolved?

How do you prevent a lapse in a client's coverage when it comes close to the end of the policy term?

What is your accuracy rate when making policy changes or processing a claim?

Claims Support

How has the coronavirus outbreak affected your ability to pay claims on time?

Does your company provide specialized training for claims professionals?

What methodology does the claims adjuster use when assessing a claim?

Besides past sales, does the claims adjuster consider market trends, new product lines or upgraded equipment when calculating a payout?

Do you provide an advanced claim payment while the claim is being processed?

What do you consider a necessary closure of operations?

What percentage of claims do you approve?

Coverage

Do you use an Insurance Services Office, Inc. (ISO) form, insurance carrier form, broker form or manuscript form for the insurance policy?

How do you determine the period of restoration?

What is the average time deductible?

How do you determine which perils must be covered?

Do you include an extended period of indemnity clause?

Financial Strength

How does the insurance carrier rank on A.M. Best or Standard & Poor's credit ratings?

What are the insurance carrier's expense ratio, operating ratio, loss ratio and combined ratio?

What methodology does the insurance carrier use to calculate the amount needed for the claims reserve?

Has the insurance carrier ever had to payout more than what they had in their reserve?

Are you experiencing fluctuations in demand as a result of the coronavirus outbreak? What measures are you taking to handle changes in demand?

Amidst widespread health concerns, what contingency plans are in place to mitigate risk to your clients and employees?

Industry Experience

What percentage of your revenue is generated from business interruption insurance?

What percentage of your business deals with my industry?

What do you consider to be common perils in my industry?

What is the standard coverage for my industry, and why?

Value-Added Services

What discounts do you offer for bundling multiple types of insurance policies?

What other insurance policies do you provide that you think may be of use to me specifically?

How do you maintain your operational efficiency when offering more than just business interruption insurance?

How does purchasing multiple types of insurance policies expedite your underwriting process, if at all?

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Key elements for every RFP

What should my RFP include?

Project Budget

Buyers should request a detailed breakdown of insurers’ premium rates.

Buyers should outline any other costs for which insurers are responsible (e.g. mailing documents).

Selection Criteria

Buyers should evaluate insurers based on their costs.

Buyers should evaluate insurers' ability to meet their coverage needs.

Buyers should evaluate insurers' market experience and financial performances.

For other selection criteria requirements, buyers should reference the Buying-Decision Scorecard section of this report.

Project Schedule

Buyers should include the date when proposals are due and any other relevant dates (e.g. final interviews) prior to the contract award.

Buyers should include the date the contract begins and ends, as well as any options for contract renewal.

Evaluate major factors to mitigate risk

How risky is the supply chain?

Supply chain risk for business interruption insurance is moderate. Providers of these insurance services rely on upstream suppliers like office supply wholesalers, computer equipment wholesalers, custodial bank and brokerage firms, reinsurers and IT consulting firms. Although brokerage firms and IT consultants are subject to intense competition, professional services sourced from... Subscribe to learn more.

HIGH

MEDIUM

LOW