Beazley leads Lloyd’s rep risk consortium

Beazley has partnered with a consortium of Lloyd’s insurers to deliver a reputational risk solution specifically for US-domiciled organisations with up to US$5bn in revenue. The Custodian Consortium offers substantial limits with additional capacity initially provided by Tokio Marine Kiln and RenaissanceRe as well as Beazley’s smart tracker syndicate 5623.

The new solution is designed to protect the insured throughout the lifespan of a crisis. Clients will benefit from crisis management expertise to minimise reputational damage, as well as substantial loss of profits cover to protect companies after a significant downturn in revenue. With underwriters’ consent, an event that threatens major reputational damage could entitle the client to crisis management advice worth up to US$1 million. The first US$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 pre-agreed drop in revenue and works on all-risks basis. Exclusions are cyber and product recall, systemic events or macro-economic impacts, failure of corporate strategy, fraud or criminal acts.

Focus group leader of Beazley’s London-based D&O team, Rachel Turk, said: “In an era in which news travels faster through social media, risk to hard-earned reputations is greater than ever before. 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 crisis management advisory firms, APCO Worldwide and CrisisRisk.

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