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Floods could dissolve food supply chains, warns insurer

20 January 2016

As Britain prepares for floods and rain this week, a leading insurance broker has warned that adverse weather could have knock on effects for the food industry. 

Debbie Day, a partner and food and beverage expert at global insurance broker Lockton, said heavy snow and floods particularly in the north of the country meant delays in getting shipments. 

“Inclement weather such as snow and heavy rain can have a dramatic effect on the supply chain, with suppliers not receiving all of the produce they require and supermarkets not receiving anticipated delivery of products,” she said. 

“The issue is twofold: traditional transport routes being affected and facilities becoming unusable.”

A report published last year by Calderdale Council found that the 2012 flooding in the East Midlands caused £823,900 in losses to local businesses. 

Day said this year’s floodings too underlined the need for a plan B. “The recent flooding in the UK has highlighted the need for companies to be prepared for such an event and have contingency plans in place should their facilities become flooded or roads/rail networks be blocked,” she said. 

“Furthermore adequate insurance policies should be in place to cover the cost of claims for damage and loss of revenue.

“Equally retailers should be confident that if one supplier is unable to deliver the desired products that the supply chain does not break down and an alternative supplier is in place.”

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