Willis Towers Watson has enhanced its casualty offering for automotive manufacturers in Asia. Dubbed as a five-in-one insurance solution, it covers general liability, product liability to product guarantee, product recall from first- and third-party, and financial loss relating to product recalls.
The new solution was developed in partnership with Swiss Re Corporate Solutions and is meant for manufacturers of automotive electronics or mechanical components operating or headquartered in Asia. It provides insurance coverage on product safety, product guarantee, government recall, third-party financial loss, general liability, product liability, and manufacturing errors & omissions (E&O).
According to the global broking firm, the number of vehicle recalls has risen in recent years, many of them coming from Asia. This uptick is due to increased usage of common components across models, rapid shifts in vehicle technology and increasing regulatory pressures around safety requirements. These recalls can inflict severe losses on automotive manufacturers.
Willis Towers Watson added that automotive companies across Europe and the US usually require product recall coverage of between US$5 million to US$10 million. However, manufacturers in Asia typically look to liability insurance with a recall extension of US$2.5 million covering third-party expenses, which does not provide complete or adequate cover.
“Whilst standalone solutions may be suitable for clients with more complex risk exposure, the cost may be prohibitive to many of the small and medium-sized businesses in Asia,” said Barbara Fabbri, Asia head of casualty, Willis Towers Watson. “Taking into consideration the specific risk exposures faced by Asian automotive manufacturers and what their clients often contractually require from them, we are introducing a combined solution to cover the entire liability exposure, avoiding coverage gaps in the Asian liability and recall insurance market today.”
