“How can a business handle its insurance coverage when a single risk is linked to three different programs, and each program requires a different description of the risk?”  The answer: By combining special coverage modules – each designed to meet specific requirements – into a single complete policy.

Our Modular Coverage Guide, below, describes a variety of coverages you and your business might need to be fully protected against loss.  You may need to  employ any or all of these coverage modules to satisfy your own specific insurance needs.  This guide will familiarize you with some of the key factors to watch for in evaluating each type of coverage.  Only a professional analysis of your specific needs, however, can determine the combination of coverages that is right for you.

Business Automobile (General, Seafood):  Long-haul, intermediate, and local trucking present serious liability risks to anyone in business.  Cost becomes an important factor for most seafood businesses incorporating trucking operations into their business plan. Inter-modal, assumed liability is particularly important due to the numerous errors made in providing coverage.  Because premium cost is often dictated on a state-by-state basis, CRC maintains relations with a number of insurers who offer competitive cost and the right coverage.

Business Interruption (General, Seafood):  Eighty-five (85%) percent of businesses investigated by CRC who have this coverage are improperly insured.  The historical statistics show that only 1 of 4 businesses survive within 2-3 years of a BI loss.  Things worsen when insurance is missing or defective.  This coverage also has application for importers who have suppliers in foreign countries making up a large volume of the importer's sales, the loss of which would impair the importer's business.

Business Package (General, Seafood):  The term itself creates a false sense of security! “Packages” generally include a number of disparate types of coverage, and give the misleading appearance of complete coverage.  In fact, these packages contain serious deficiencies in the form of exclusions, limitations, warranties, insufficient limits, and rate inflexibility.  They were designed to address the general needs of a broad range of policyholders.  Packages were not designed to address all the individual risks related to a business.

Cargo (Seafood):  Policies issued to seafood businesses with 24-hour breakdown coverage are inadequate.  Broader wording for “change of temperature" including “lack of fuel,” “inadequacy of refrigeration unit,” “improper maintenance,” and loss due to “error or failure to plug in power unit” is vital to cover all the perils causing large losses.  Rejection is another important aspect to some.  Did you know that using the wrong "terms of sale" can lead to a totally uninsured loss?  Did you know that, during the past 25 years, the most frequent, large seafood cargo losses, hi-jack and change of temperature, happen during truck transit within the United States?  Did you know that the insurance coverage of most seafood businesses is inadequate for these risks?  Did you also know that the legal liability coverage carried by most seafood truckers has inadequate limits or does not cover change of temperature or both?

Cargo Insurance - Importers/Exporters (General, Special):  At CRC, our cargo specialists - with cargo insurance experience of up to 40 years - provide risk identification, analysis and specially-designed cargo insurance coverage, addressing your risk transfer needs and budget goals.  CRC uses its own proprietary policy terms and conditions in its coverage design, integrating unique claim-payment features, to ensure the fastest most reliable claim payments.  CRC’s cargo claims specialists have a minimum of 22 years of experience to quickly and effectively assist you in your claim handling needs. CRC maintains numerous coverage design templates for a variety of international transit categories that apply CRC’s many years of experience to your advantage.

Cargo Rejection (Seafood):  Foreign seafood supplier selection is paramount to the rejection risk.  CRC’s long experience and proprietary selection process ensure low-cost premiums, underwriter security, and, most importantly, maximal importer profits.  CRC has more experience in rejection coverage design and claims adjusting – 25yrs – than its competitors.  Did you know that domestic rejection-type losses can be even larger and more financially devastating once goods leave “import status?”  See Product Safety.

Consequential Damage Liability (Seafood):  Supermarket chains, hotel chains, airlines, and other large, institutional buyers can bring a legal action due to a contamination event caused by your product, such as decomposition, salmonella, Listeria, Staph, Veterinary Drug Residue, Scombrotoxin, etc.   The suit includes costs for customer legal defense costs, customer recall costs, laboratory testing costs, customer claims for loss of profits and reputation, your investigation costs and your legal defense costs.  If you thought they were covered by your liability insurance, you would be mistaken. Worse yet, look at the seafood sales contracts you signed. You assumed liability for all this with no insurance coverage.

Credit Insurance (General, Seafood):  This is an excellent tool to expand your business and transfer your credit risk from your balance sheet to an insurer. However, it is not a total panacea.  A credit policy has limits, strict conditions, doesn't replace your credit qualifying procedure, and doesn't insure all of your buyers.  Credit Insurance is available for your domestic and international customers.

Crop Mortality (Seafood):  Both foreign and domestic aquaculturists are faced with a daunting array of environmental or naturally-induced viral and bacterial conditions affecting their crops.  As protein demands increase with the world population, more and more pressure will be placed on effective, safe crop production.  The financial risks are becoming significant as the pressure to produce rises.  Large pond shrimp producers are most vulnerable.  The insurance market is very limited for this coverage.

Directors & Officers (General, Seafood):  Yes, privately held businesses should have this coverage. It is not just for publicly held companies.  Suits don't just come from stockholders.  Regulatory agencies, employees, and outside third parties are among those from whom you can expect suits.  It could be a competitor claiming deceptive trade practices, a customer claiming refusal to extend credit, or a governmental agency bringing actions for banking law violations, civil-rights issues, or environmental matters.  The excessive cost of defending such an action is well worth the premium charge.

Disaster Recovery Plan (General, Seafood):  Learn from September 11^th and the World Trade Center disaster.  It was determined that most businesses were unprepared for such an event.  If you don't have a “Disaster Recovery Plan,” your business is in serious jeopardy.  If you have a plan but it has deficiencies, you could also be in jeopardy.  How good is your plan in the following areas?   Facilities relocation, restoration, security, utilities, damage assessment, salvage operations, procuring operations equipment, important work environment issues.

Employee Practices Liability (General, Seafood):  This is a burgeoning body of law.  Wrongful termination, harassment, and discrimination, real or imagined, have become popular reasons to bring an action.  Very often, a governmental agency is involved as well. Some statistics show that the typical case produces $100,000 in defense cost and $350,000 in settlement. It has also been said that the federal courts now have an alarming number of these suits on the docket.  From our surveys, most seafood businesses have had incidents that would have been covered by this insurance.  From our experience, the most cost effective way to purchase EPL is by combining it with Director's & Officer's insurance.

Environmental Liability (General, Seafood):  Section 1311 (a) of the federal Clean Water Act is clear.  “The discharge of any pollutant by any person shall be unlawful”  without a permit.  Domestic aquaculturists, in freshwater or seawater, are at risk due to discharges of contaminated water from their settling ponds, ocean bottom accumulation of waste or other contaminating sources at their facilities.  Veterinary Drug Residue, chemicals, other pharmaceuticals, sediment, suspended solids, altered PH, nitrogen, ammonia, temperature, among others, are just a few of the pollutant discharge issues.  Citizens and consumers are becoming more aware of and more active about this growing environmental risk.

Financial Guaranty (Special):  CRC has developed some very sophisticated arrangements within the scope of this obscure type of insurance.  Some of the interesting efforts have been “guaranteeing real estate market values seven years into the future,” “guaranteeing the resale value of fishing fleet vessels five years into the future,” and “guaranteeing a minimum volume of water held in aquifers in mountains north and east of Los Angeles.”  The market for this type of coverage is very limited and esoteric.

Food (all types, all categories) (Special):   For over 25 years, CRC has specialized in insurance coverage for a variety of food businesses - particularly food importers.  Dealing with marine cargo, warehousing, truck transit, product safety in overseas plants involving GMPs, HAACP, SSAN, and environmental risks, has uniquely qualified CRC to deal with all the special problems of processing, storing, or transporting presented by dairy products, meats, seafood, and the entire array of food items.

Food - Wholesalers/Distributors (Special):  Special Warehouse & Inland Transit:  CRC’s investigation of numerous wholesaler/distributors continually detected numerous uninsured conditions, particularly for the change of temperature peril relating to goods stored in warehouse or during truck transit.  The uninsured warehouse exposure often reached as high as $8 million dollars and the uninsured truck transit exposure reached as high as $400,000.  CRC developed a special policy, providing all the proper coverages and rating features to make it the most competitive of its kind in the USA.

Foreign Inland Transit (Seafood):  Same situation as the “foreign warehouse.”  Either  the terms of sale are not clearly defined, particularly where there is an advanced payment situation, or sale terms are misunderstood.  INCO Terms are rarely followed.  Additionally, there are conditions that exist where cargo insurance doesn't apply unless it is changed - multiple truck shipments to a consolidation point, re-stuffing a container, taking more than 2 weeks to ship, and more.  Exposures can be as much as $500,000 or more.

Foreign Political Risks (General, Seafood):  Those seafood businesses that provide funds for plant, equipment, and stock to foreign processors are exposed to the risks of a foreign government's refusal to permit export, confiscation, seizure, expropriation or appropriation.  Additionally, war, civil war, revolution, rebellion, insurrection or hostile acts can also be threats to property.  None of these perils are covered by the typical property insurance policy. Politically unstable countries create prime climates for this cover.

Foreign Production (Seafood):  Many seafood importers provide funds for plant, equipment, and stock to foreign processors as a means of maintaining a unique supply of seafood. Often, insurance is overlooked.  Often, the financial risk of loss can be in the millions. Too often, there is no insurance or it does not meet the minimum standards we are accustom to in the US.  Building, stock, and contingent business interruption are just a few of the coverages to consider.

Foreign Warehouse (Seafood):  It doesn't stop with processors.  Many importers provide advance funds for stock to foreign supplier as a means of financing that supplier and maintaining a unique supply of seafood.  Seafood gets stockpiled awaiting shipment at local warehouses or at the process plant.  CRC's investigations often uncover an uninsured condition.  Importers often learn that coverage doesn't exist - the importer is not an added insured on the supplier's policy - or coverage is defective.  Rarely is there an effective investigation into this area and the exposures can be as much as $500,000 or even more.

General Liability (General, Seafood):  Too often treated with nonchalance, this coverage - particularly products liability and “added insured” status - has risen to prominence due to coverage defects or non-insurance conditions in many policies issued to seafood businesses.  Because of these conditions, certificates of insurance are being issued improperly - exacerbating the non-insurance issue.  Further, many seafood businesses wrongly believe that all the risks presented by Hold Harmless Agreements are covered by the general liability  policy.  Nothing could be further from the truth!

Global Medical/Emergency Evacuation (Seafood, Special):  Importers travel to and from countries, around the world, that have limited emergency and medical facilities, compared to the US.  If you are hospitalized, in some countries, you can't leave until you have paid the bill.  Moreover, if you are seriously ill, it may be advisable to be moved to medical facilities that are equipped to handle your condition - including the US.  Insurance exists that will provide coverage to evacuate you and, importantly, provide you with a local advocate to make all the arrangements and details.  For several hundred dollars a year, this is one of the best insurance buys available.  Don't leave home without this coverage!

Health Insurance (General, Seafood):  For the vast majority, this is the single largest insurance cost for a seafood business.  Knowing this, CRC has searched out providers offering the highest quality for the most competitive price.  In particular, for businesses with 50 or more employees, CRC offers an insurer/provider  having the greatest coverage flexibility, high service standards, and the most competitive rates - bar none!  CRC is confident that upon close inspection of coverage, service and cost, your concerns about this “big ticket” item will rapidly dissolve.

Inland Transit, Domestic (Seafood, Special):  This is the area of high loss frequency and large loss amounts - as much as $600,000.  Very often frozen seafood products arrive at the buyer's warehouse with evidence of being softened and refrozen and “clean receipts” have been issued by the steamship company, local trucker, warehouse and the delivering trucker.  All will deny liability in spite of the fact that there is physical evidence of damage.  Who pays?  You do, if you don't have your inland transit coverage in the cargo policy and you don't have the perils insured as outlined in “Cargo” above.

Kidnap, Ransom, Extortion (General, Seafood, Special):  Importers rarely consider the need for these coverages - believing, like many Americans, in an air of invulnerability. September 11, 2001 changed that notion.  The four top countries of the world where these activities take place most frequently are Brazil, Mexico, Columbia and, yes, the United States.  Most US importers traveling abroad on business have no idea what would be done if they were kidnapped and held for ransom or how they could resolve the threat of the bombing of a processing plant in which they had a significant financial investment.

Life Insurance (General, Seafood):  High quality executives and employees are corporate assets too. Risk management needs to be applied in this area as well.  Key employees life, disability, buy/sell agreements, deferred compensation plans, estate planning, enhancement of assets are only a few of the insurance products brought into play in dealing with this critical area.  CRC maintains a highly-qualified staff with a vast knowledge of tax implications and elegant insurance strategy applications to effectively bring about the results you would expect in dealing with such a sensitive area.

Marine Liability (Special):  Protection & Indemnity, Charterer’s Liability, and Cargo Legal Liability are often intertwined.  CRC has provided policy designs, either together or separately, for years.  The key to proper coverage and premium cost containment is in the analysis of the various legal contracts.  CRC maintains a number of viable markets to provide these coverages.

Non-Vessel-Owning Common Carriers - (NVOCC) (Special):  Knowing and understanding the bill of lading used by the NVOCC is the key to coverage and cost.  NVOCC’s evolved as freight forwarders became more sophisticated and the international business horizons expanded along with multi-modal transportation.  CRC has developed a niche in this area of marine insurance expertise.

Product Contamination (Seafood):  If you thought products liability covered all the losses, you would be wrong.  Tylenol was a good example!  Hudson Beef and Jack-in-the-Box were better!  Seafood is no exception.  Accidental Product Contamination and Malicious Product Tampering can be vital coverages to address the cost of recall, loss of gross profit, your product replacement cost and the market rehab expenses a seafood business in a contamination event.  Extortion coverage can be added for those with A & P contracts.

Product Safety (General, Seafood):  This is a growing area of concern in planning business insurance coverage, one that is seldom understood.  For example, during the past five years, seafood customers have increasingly demanded written, contractual responsibility by seafood sellers for product safety, including all the costs - yours and theirs - when something goes wrong.  Seafood sellers rarely understand the high cost of the uninsured risks they assume in those written contracts.  CRC has, again, pioneered insurance coverage that deal with these newly-emerging, uninsured risks.  Also see Product Contamination, Sales Contract - Assumed Liability, Recall, Public Relations  Specialists, and Consequential Damage Liability.

Property (General, Seafood):  Because of CRC’s unique design, underwriters can provide lower premium costs and higher limits. With CRC’s design, the ease of covering buildings, machinery & equipment, and other property elements is enhanced for the underwriter.  With CRC’s thorough analytical process, inadequate limits, improper valuation for loss, and coinsurance penalties are eliminated.  Moreover, CRC’s Loss Prevention Engineering capability is an important asset when dealing with high-pile, cold storage warehouse protection issues.  Highly Protected Risk property insurance is an important special capability of CRC.

Public Relations Specialists (Seafood):  It was reported that Jack-in-the-Box experienced an 85% drop-off in sales due to the bad press and tainted consumer perception.  A number of seafood businesses, who experienced a contamination event and having no experience in handling such a media circus, handled the public relations damage control by themselves with no advice.  Many have spent thousands, if not millions, in developing a brand name.  Would you spend a few thousand dollars to protect your brand name in a contamination event?  There is no coverage under any of your standard policies.

Recall (Seafood):  Your lost earnings from losing account, transportation costs, radio, television and print announcements, chemical analysis, additional salaries, warehouse costs, and the cost of public relations experts are all excluded in your liability and package policy (although some packages do provide minimal coverage for some of these items).  Can the loss of a large customer cost you $250,000 or more?

Sales Contract Assumed Liability (Seafood):  Sign your name - destroy your business.  When you sell seafood and sign a contract, some of the assumed liabilities are: third party extortion, replacement cost value of your product, recall, bodily injury, buyer lost profits, buyer legal defense costs, adding coverage for your buyer under your insurance policy, and you pay financial consequences whether negligent or not.  The process is called risk transfer.  Rarely is an attorney involved.  There is blind risk taking by seafood sellers.  Low-level, seafood company administrators, lacking any knowledge of the financial consequences of risk, deal with these risks.  How does your company deal with this issue?

Cargo Legal Liability (Seafood):  Special Coverage for Seafood Truckers:  Cargo liability insurance carried by truckers hauling seafood has traditionally been deficient.  Inadequate limits, lack of change of temperature, lack of coverage for theft by owner/operators acting as subcontractors are among the deficiencies.  CRC provides proper limits, perils insured, numerous added features, and three different rating plans to offer the best coverage available in the market.

Stevedores (Special):  CRC offers general liability, stevedore liability, terminal operator’s liability, environmental liability, excess workers compensation, and bumbershoots to $50 million.  Coverage is available from a handful of underwriters.  CRC offers a unique liability policy feature that sets CRC apart from the competition.

Stock Legal Liability (Seafood):  An often overlooked issue by insurance professionals and policyholders alike.  Many importers, who also have their own warehouses, allow customers to store goods at the importer’s warehouse that those customers may have purchased from the importer.  The issue is, “who owns the goods?”  If the goods were paid-for by the customer and they are still in the warehouse, the goods can't be insured by the property policy of the importer unless the policy is modified to allow it.  The coverage is for “goods in care, custody or control” and such coverage is normally excluded unless modified.

Terrorism (General, Seafood):  September 11, 2001, The World Trade Center, thousands died.  Billions of dollars in property damage.  The world changed.  Now, the insurance community struggles just to define the word.  Attempts are now being made to exclude terrorism from most insurance contracts.  Little to no coverage exists in the world.  Every business is at risk.  The worldwide insurance community is wrestling with whether or how to provide coverage for the peril.  Notwithstanding insurance availability, this is a risk that requires much analysis and evaluation.

Umbrella Liability (General, Seafood):  One of the most important coverages in your portfolio.  It provides part of the high limits needed for catastrophic liability losses.  It acts to increase underlying coverage limits, broadens coverage in some cases, and when underlying policy limits are exhausted because of aggregates, the umbrella becomes the primary for defense costs and indemnity payments for injury.  These policies are not all the same and have a number of coverage pitfalls.

War & Other Exclusions (General, Seafood):  War, civil war, revolution, rebellion, insurrection or hostile acts can also be threats to property.  All of these perils and how they are defined in an insurance policy have taken on a new significance and are no longer obscure risks that may never happen.  Thoughtful consideration of these perils must now be applied when purchasing any property insurance policy.

Warehouseman’s Legal Liability (Cold Storage) (Seafood, Special):  High-piled rack storage over 25', questionable fire protection, large change of temperature risk, huge values of stock exposed to loss, windstorm in Florida, earthquake in California, and target commodities are among the serious issues facing a cold storage warehouse operation.  Insurance markets are very limited.  Through its 25-years of seafood insurance experience, CRC has developed a market to respond with comprehensive coverage and viable rates.

Warehousing, Domestic (Seafood, Special):  Many seafood businesses rely on public warehouses to pay losses and either don't insure or use a standard package policy to provide coverage - a big mistake!  “Perils insured” should be identical to those of the cargo policy for all the loss reasons in “Cargo” above.  Plus, the coverage should be in the same cargo policy to eliminate “finger pointing” by separate insurers on cargo and warehouses.  The majority of warehouses in the US have a limitation of liability of either $0.50/lb or 200 times the storage charge.  This is little help with products ranging in value from $2.00/lb to $14.00/lb.

Worker’s Compensation (General, Seafood):  For some, particularly domestic processors, manufacturers, wholesalers and importers operating their own warehouse, the cost of this coverage is the largest of a seafood business' property/casualty insurance portfolio.  CRC maintains relations with many insurers who offer a full range of premium-reducing techniques such as dividend, retention, and retrospective rating plans and many more.  They are as simple or as sophisticated as need be to meet your needs.

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