Swine flu scare exposes vulnerabilities
As the World Health Organisation revises up its H1N1 swine flu death toll for Mexico to 72 from 45 and adds Australia’s one reported case to 8480 in 39 countries, mega-broker Marsh says the pandemic alert has caught some businesses ill-prepared.
Gary Lynch, the global leader of Marsh’s Supply Chain Risk Management Practice, says many firms’ business continuity management plans “may not adequately cover a situation involving communicable diseases that can affect employees and the general population on a wide scale”.
Australian Prudential Regulation Authority (APRA) spokesman Stuart Snell says the regulator has been stepping up its work with the insurance industry in recent years regarding pandemic preparedness with guidance rather than prescribed standards.
“There’s also a role for the Insurance Council of Australia, and I understand they have their own plan for industry,” he told insuranceNEWS.com.au. “We have provided guidance as to the sorts of things companies should be doing, but we don’t have any legislatively backed standards.”
“I believe ICA has had some initiatives in this area. I think they have even gone as far as doing research beyond the mechanical things – a bit deeper with the use of actuaries with costings and the like.”
ICA declined to comment on the issue when approached by insuranceNEWS.com.au.
Marsh is advising organisations to treat pandemics as truly catastrophic events rather than “manageable disruptions”. It is also calling for the establishment of pandemic planning committees supported by real budgets.
It says organisations should be prepared to protect critical products and services, even at the expense of other important elements of a business model.
Gary Lynch, the global leader of Marsh’s Supply Chain Risk Management Practice, says many firms’ business continuity management plans “may not adequately cover a situation involving communicable diseases that can affect employees and the general population on a wide scale”.
Australian Prudential Regulation Authority (APRA) spokesman Stuart Snell says the regulator has been stepping up its work with the insurance industry in recent years regarding pandemic preparedness with guidance rather than prescribed standards.
“There’s also a role for the Insurance Council of Australia, and I understand they have their own plan for industry,” he told insuranceNEWS.com.au. “We have provided guidance as to the sorts of things companies should be doing, but we don’t have any legislatively backed standards.”
“I believe ICA has had some initiatives in this area. I think they have even gone as far as doing research beyond the mechanical things – a bit deeper with the use of actuaries with costings and the like.”
ICA declined to comment on the issue when approached by insuranceNEWS.com.au.
Marsh is advising organisations to treat pandemics as truly catastrophic events rather than “manageable disruptions”. It is also calling for the establishment of pandemic planning committees supported by real budgets.
It says organisations should be prepared to protect critical products and services, even at the expense of other important elements of a business model.