food & beverage · confectionery, biscuits, ready meals, sauces etc. ... (limit €100,000...
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Food & BeverageRonan Kavanagh, Aviva
Aviva: Internal
Aviva
Complete Protection For
Irish Food & BeverageBusinesses
September 2018
Food & Beverage Proposition
Cover and Considerations
.
Aviva: Internal
Page 1
Objectives & Agenda
Aviva have a strong appetite to write Food & Beverages risks.You will leave with a clear understanding of Aviva’s appetite and know how to get
the best quote from us.
Agenda:
➢ Overview
➢ Aviva Appetite
➢ Employers Liability
➢ Public & Products Liability
➢ Product Recall
➢ Property Covers
Aviva: Internal
Page 2
Sector Overview
▪ In depth review of current Aviva held business in F&B sector
▪ Carried out extensive research with brokers and
representatives of the F&B Industry
▪ Analysis showed profitable sector in clearly identified
segments particularly in SME rather than large F&B risks
▪ Market very evenly spread with no one Insurer dominant
▪ Aviva currently hold market share of 12%
Aviva: Internal
Page 3
Objectives & Agenda
The Proposition – a reminder
▪ 4 Offers for the F&B Industry.
▪ Composite Offering for Life & General
▪ Clear Risk Appetite for segments in F&B Industry
▪ Dedicated expert underwriters in Dublin & Cork
▪ Wrote directly to 4000 food business asking them to think of Aviva and contact their broker
Aviva Complete – Complete protection for your
business, family & financial future
Aviva: Internal
Page 4
Food & Beverage – Size of the Prize
1051
497
362 338307
231198 186 175
120 98
0
200
400
600
800
1000
1200
Approx 3,564 Food & Drink Companies in Ireland50% Have Websites – 50% Do Not
655 Large Companies – 18%
2909 SMEs – 82%
80% Food, 10% Drink & 10% Catering
PCF = Prepared Consumer Foods –Confectionery, Biscuits, Ready Meals, Sauces etc
Aviva: Internal
Page 5
Food & Beverage – Claims 2001-2016
19%
12%10%
9%8%
5%4% 4% 3% 3%
0%2%4%6%8%
10%12%14%16%18%20%
67% of Claims Relate to Employer Liability
Top 10 Claim Types Account for 77% of All Claims
Aviva: Internal
Page 6
Food & Beverage - AppetiteSegments of great interest Selected customers/products only
Segment Large SME
Drinks Alcoholic 25 150
Drinks Non Alcoholic 40 158
PCF (Approved CIPs no Heat Process Only)
931
Meat 120 242
Catering 40 298
Fruit/Veg 71 115
Seafood 435
Dairy 171
Ingredients 80
Poultry/Eggs 62
Total 296 2642
Segment Large
SME
PCF 121
Bakery 40 267
Seafood 62
Dairy 60
Ingredients 40
Poultry/Eggs 36
Total 359 267
Aviva: Internal
Page 7
4 of the Offers for the Irish Food & Beverage Industry
Aviva: Internal
Page 8
Food & Beverage – The Composite Offering
Aviva: Internal
Page 9
Additional Cover - Product Recall
Cover = Product recall withdrawal expenses
We cover the Insured’s direct recall costs:▪ Communications▪ Transport▪ Storage▪ Disposal▪ Staff▪ Expenses
Cover Availability: (Limit €100,000 subject to satisfactory questionnaire)
*Excess is 10% or €5k which ever is greater
Aviva: Internal
Page 10
Employers Liability
Death, bodily injury, shock, illness or disease caused during
the Period of Insurance, to any person under a contract of
service or apprenticeship with the Insured, if such death,
bodily injury, shock, illness or disease arises out of and in the
course of such person’s employment by the Insured.
Aviva: Internal
Page 11
Employers Liability
Cover
▪ Limit of Indemnity €13,000,000
▪ Wide definition of ‘employee’
▪ Contractual Liability cover
▪ Court Attendance costs
▪ Unsatisfied Court Judgements
* Higher limits available
Appetite
▪ Employ 1 to 1,000
▪ Based in ROI (& UK
subsidiaries)
▪ Good H&S standards
▪ Good Claims Experience
Aviva: Internal
Page 12
Public & Products Liability
Death, bodily injury, shock, illness or disease of any person except that arising our
of and in the course of such person’s employment by the insured under a contract
of service or apprenticeship
Loss of or physical damage to physical Property not belonging to the Insured or in
the charge or under the control of the Insured or any servant of the Insured.
Loss arising from obstruction trespass nuisance or interference with any easement
of air light water or way
Aviva: Internal
Page 13
Public & Products Liability
Cover
▪ Limit of Indemnity €6,500,000*
▪ PL Contractual Liability cover
▪ Rented Premises cover
▪ Unsatisfied Court Judgements
* Higher limits available
Appetite
▪ Turnover €5k to €50m
▪ Retailers, Wholesalers &
Manufacturers
▪ Good QC procedures
▪ Good Claims Experience
▪ Exports to North America
Aviva: Internal
Page 14
Understanding Food Risks
When underwriting risks in the Food and Drink sector we look to understand two primary elements:
1. The products that are made
2. The processes involved in the manufacturing of the product
3. The construction of the Property and understanding of CIP’s
4. Investment in Health & Safety is vital in this industry
Aviva: Internal
Page 15
Product – Key Categories
Meat, Poultry, Fish Cooking with Dry Heat
Deep Fat Frying Drinks
Aviva: Internal
Page 16
Product – Process & Hazards
Process:
▪ Receipt of meat/poultry/fish in bulk
▪ Cleaning, jointing, deboning, filleting
▪ Using mechanical or hand held tools
▪ Level of automation▪ Mixing in required
proportions▪ Cooking – dry heat, frying▪ Refrigeration / Freezing▪ Carbonation, bottling▪ Packaging, storing,
despatching
Hazards:
▪ Electrical infrastructure and equipment – ‘wet’ process areas
▪ Ammonia ▪ Construction – use of CIPs ▪ Failure of temperature
control systems▪ Build up of combustible
deposits ▪ Gas explosion▪ Flammable vapours that▪ Poor cleaning regimes
Aviva: Internal
Page 17
Other ConsiderationsWhilst, common to all risks in this sector, the following are also important;
Arson Hot Works Smoking Fork Lift Trucks
Lighting Vibration Packaging
Materials
Waste
Management
Aviva: Internal
Page 18
CIPs – Where & Why?
Advantages
▪ Factory produced under controlled conditions
▪ Ease/speed of initial build
▪ Performance and durability
▪ Cost
▪ Hygiene & thermal performance
Disadvantages
▪ Fire spread
▪ Heat release
▪ Fire brigade attitude
▪ Personal injury
▪ Claims costs
Usage/Locations
▪ External wall cladding Cold store constructions▪ Acoustic barriers Sterile risks▪ Roof cladding Internal enclosures and internal wall and ▪ Compartment walls Ceiling linings
Aviva: Internal
Page 19
Understanding the Exposure - Checklist
Understand the risk and exposure presented:
▪ Activities and Processes
▪ Concentrations of values, EML
▪ Construction incl. panel type and fitting, location and percentage of risk
▪ Active fire protection (e.g. sprinklers, AFAs, suppression) / Passive fire protection (fire walls, doors/other openings, fire stopping)
▪ Site fire safety management, both internal and external:
➢ Housekeeping / Maintenance programmes including panel management and dealing with defects
➢ Staff training
➢ Security
➢ Permit to work/Hot work controls – including before any layout alterations
➢ Electrical testing
➢ Arson prevention
➢ Panel Management programme
➢ Risk management needs to recognise that work on/around panelled areas may not be solely by contractors but also by insured’s own employees
Aviva: Internal
Page 20
Success to date +€3M achieved to date
Over €3 Million in New Food & Beverage BusinessWritten Since launch
Micro Breweries Meat
Dairy
Fruit & Veg
Chocolate / Cheese
Manufacturers Ingredients
25Aviva: Internal
Appendices
26Aviva: Internal
Property- Other Hazards in Food & Drink Industry
Feature/Hazard Comment
Dairy – pasteurisation – heating of milk • Generally low risk as temperature reached 72 degrees
Shrink wrapping involves heat sealing of wrapping,
bags – various types of heat sealing seen
• Medium to high risk at can operate at 100 – 200 degrees C
• Repetitive actions, trapped/stuck bags etc.
Conveyor systems
Feeding products into fryers/ovens or between units –
if conveyor stops product can be exposed to heat for
much longer than planned &/or carry burning materials
across site
• Combustible elements e.g. belts, transfer flames, burning material
• Build up of dust/residue on conveyor (or below in hard to clean areas)
• Alignment & slippage – mechanical peril
Electricals – in machinery and fixed installation.
Overheating of circuitry is major hazard. Also HID
Lighting, FLT charging, Overhead heaters
• High demand on machinery & capacity of installation
• Cables penetrating CIPs – hot copper wires
• FLT Battery charging (ideally 60 minutes fire resisting enclosure if inside)
External Storage – arson/spreading fire risk • Wood & plastic pallets/containers
• Skips/recycling containers with packaging materials – 10M from building
• Housekeeping essential, consider Security devices, CCTV, Guarding
Flammables – oils, liquids, cooking mediums, gases,
solvent extraction in oils manufacture. High fire load,
often readily ignited.
• Proximity to ignition sources
• Earthing & bonding
• Maintenance/storage/segregation/ventilation/ATEX/DSEAR
• Detection & Suppression systems
• External storage desireable
Ammonia
Widely used as a refrigerant, flammable in air &
explosion risk
• Proximity to ignition sources
• Maintenance/storage/segregation/ventilation/ATEX/DSEAR
• Detection & Suppression systems
Dust - any finely ground solids at certain
concentrations can explode on ignition form a fixed
flame to a static charge
• explosive dusts e.g. flour, custard powder, instant coffee, sugar, dried mile, potato
powder, soup powder, tea
• fine dust in contact with hot surfaces or ignition sources can cause fire – example of
tea & tea bags in extraction system
27Aviva: Internal
Core materials - reaction to fire and fire resistance capabilities
Expanded polystyrene:
• Readily combustible
• Will shrink and melt away from a small heat source
• Supports combustion and burns with severe flaming
• Rapid emission of heavy black toxic smoke and flammable gases
• Early panel delamination
• Flaming droplets not uncommon
Polyurethane Foam;
• One of the most commonly encountered core materials.
• Some polyurethanes have an element of heat and fire retardancy and will prevent ignition from low heat sources (but will not prevent ignition from larger heat sources).
• Depending upon formulation can have a rapid rate of heat release when directly exposed to sizeable flame.
• When encapsulated in a sandwich panel with good joint design, the risk of serious fire spread is reduced (but not eliminated).
28Aviva: Internal
Core materials - reaction to fire and fire resistance capabilities
Polyisocyanurate Foam:
• Resistant to all but large ignition sources, but does greatly depend on the formulation of the product and quality control (hence the importance of LPCB Approvals).
• When foam core directly exposed to a flame will initially burn rapidly until formation of a char layer which tends to prevent further combustion (NB joint design and construction detail important as char layer can be fragile)
• LPCB approved polyisocyanurate panels will perform significantly better than standard non-approved PIR panels. (LPS 1181 and LPS 1208 are deemed non-combustible for rating purposes).
Modified Phenolic Foam:
• Some of the more recent phenolics have very good fire resisting qualities.
• Not easily ignited.
• Has the closed cells filled with inorganic fillers e.g. gypsum
• Some manufacturers panels have been tested by LPCB under LPS1208, and are now approved (performed significantly better than some of the LPCB approved PIR’s)
Rock Fibre / Mineral Wool:
• Non-combustible.
• Made from glassfibre, slagwool, rockfibre, rockwool etc)
• One of the best materials in respect to fire protection available.
• The higher the density of the panel the higher the fire insulation.
Aviva: Internal
Loss Prevention Certification Board
Loss Prevention Standard 1181
Tests the fire performance of CIPs in the external structure I.e. walls and roof cladding
Loss Prevention Standard 1208
The performance standard that covers fire resistance, specifically in relation to compartmentation and internal.
Panels conforming to the above should not significantly contribute to fire growth or fire spread
30Aviva: Internal
Property Insurance – CIPs Summary
CIPs Summary:
• We accept that ‘panels’ do not cause fires
• Panels are only part of the equation
• External cladding may present a better risk profile
• Selection paramount – we want the best!
• Preference has to be for non-combustible materials or LPCB Approved products but:
• Composite panels are not considered in isolation of other risk features
• Consider the type and application - external v internal, polystyrene v others, proportion of CIPs in total building construction, trade process
• Not all composite panels are a significant hazard i.e. no significant contribution to fire growth or spread (Design Guide) if LPCB approved
31Aviva: Internal
Meat Poultry and Fish Processing – No Cooking
Processes are likely to include:
▪ Receipt of meat/poultry/fish in bulk; ▪ Cleaning, jointing, deboning/filleting using mechanical or hand held tools; ▪ may be extensively automated▪ packaging, storage and despatch ▪ Processes may also include receipt and slaughter of animals.
Main hazards are likely to be:
▪ Electrical infrastructure and equipment – especially in ‘wet’ process areas,▪ Ammonia ▪ Construction – use of CIPs is often seen in these trades
32Aviva: Internal
Meat Poultry and Fish Processing – No Cooking (cont.)
With no cooking/smoking/curing there should be no inception risk from this source.
Whilst, common to all risks in this sector, the following are also important
Arson Hot Works Smoking Fork Lift Trucks
Lighting Vibration Packaging
Materials
Waste
Management
33Aviva: Internal
Wet mixing – cooking with dry heat e.g. ovens
Processes can include:
▪ Receipt of ingredients e.g. into vats/silos
▪ Mixing in required proportions▪ Cooking▪ Packaging ▪ Refrigeration/Freezing▪ Despatch
Main hazards are likely to be;
▪ Process heat – ovens▪ Overheating/burning of food due to:▪ the failure of the temperature control systems, ▪ in the case of travelling ovens a change in the speed of
the conveyor.▪ Some ovens use internal gas burners to brown products
but may ignite the product▪ combustible deposits that build up in the oven and the
fume extraction ductwork▪ Build up of crumb/cooking oils▪ Oil spraying onto food materials entering oven▪ Gas explosion▪ flammable vapours that are released▪ leakage of oils and other flammables in the oven ▪ auto heating with no attendance, cleaning regimes,
housekeeping▪ Electrical equipment – especially in ‘wet’ process areas▪ Ammonia ▪ Construction – use of CIPs is often seen in these trades
34Aviva: Internal
Cooking Heating
Cooking/heating – Considerations;
• Where is cooking undertaken in relation to fire-load; e.g. packing/storage
• What type of cooking processes are used
• What are walls/ceilings/roofs comprised of within at least 10m of such areas?
• How do any services/ducting pass through the walls/ceilings/roofs?
• Oils, fats used in cooking processes?
• Naked flames e.g. Grilles?
• Suppression, or capability of being suppressed? Cost/business disruption? Premier offering? Partial
discounting of risk?
• Auto cut out devices/thermostats on cooking devices
• Manual main fuel shut off valve – gas or electric
• Degree of supervision
• Cleaning & maintenance regimes
Solutions;
✓ Ideally housed in 1 hour compartment
✓Automatic temperature controls
✓Regular inspections and cleaning
✓Fire suppression
35Aviva: Internal
Frying/Deep Fat Frying
Processes can include:
• Receipt of ingredients
• Preparation of ingredients e.g. washing, peeling, mixing together
• Frying
• Cooling
• Refrigeration
• Packaging and despatch
Main hazards are likely to be:
• Process heating. Frying is inherently hazardous and fires are frequently seen – both in the fryer itself & surrounds as well as in the ducting/flues; requires constant supervision
• Spontaneous combustion of crumb
• Electrical equipment – especially in ‘wet’ process areas
• Ammonia
• Construction
Hazards common to all food risks
36Aviva: Internal
Frying
Frying – key issues:-
• Fryers typically operate at 200 degrees C & contain more than 300 litres of oil
• Flammable vapours given off at 230 degrees C & auto ignition can occur at 310-360 degrees C
• Common hazards:- ignition of the cooking oil in pans/hot surfaces
➢ Spontaneous combustion of crumb
➢ Sediment deposits and ductwork fires from a build up of fats and greases
➢ Poor supervision of cooking operations a major problem – several large losses
• Duct fires common & often difficult to manage
• Ducts & other services penetrating panels and other combustible materials; requiring fire stopping, sleeves & collars
• Oil level shut off devices, high temperature controls/cut out & electric/gas shot off facility all required
• Sediment/crumb, often a significant problem as can spontaneously combust - regular cleaning and emptying of catch boxes (metal) required
• Oils can pose risk of a flowing fire. How and where are they stored? What are their properties (e.g. flashpoint)
• Conclusion – Businesses with any frying involved are outside our appetite (not including frying in staff canteens however usual requirements apply such as cleaning of ductwork extraction system)
37Aviva: Internal
Soft Drink manufacturing
Processes are likely to include;
• Receipt of ingredients
• Pulping/juice extraction
• Filtering
• Addition of any required ingredients
• Carbonation – if required
• Bottling and despatch
Main hazards are likely to be;
• Electrical equipment – especially in ‘wet’ process areas
• Syrups, flavourings and concentrates can be flammable e.g. Sprite
Whilst, common to all risks in this sector, the following are also important
• Arson
• Hot Works
• Smoking
• Fork Lift trucks
• Stocks of packaging materials
• Waste management
• Construction
38Aviva: Internal
Composite Insulation Panels (CIPs)
Advantages:• Factory produced under controlled conditions.
• Ease/speed of initial build
• Performance and durability not dependent on site labour quality.
• Cost.
• Hygiene & thermal performance.
• Alteration of internal layout
Disadvantages:• Fire spread.
• Heat release.
• Fire brigade attitude.
• Environmental considerations.
• Personal injury.
• CLAIMS COSTS…..
• Difficulty in identifying core
• Method and quality of installation varies
Usage/Locations:
External wall cladding Cold store constructions.Acoustic barriers. Sterile risksRoof cladding Internal enclosures and internal wall and Compartment walls. ceiling linings
Aviva: Internal
Trade Processes – Property Underwriting
Food -
No Cooking
Meat, Poultry and Fish processing - no cooking.
Corn, Rice, Wheat etc. processing
Hay/Straw etc
Fruit and vegetable processing - no cooking
Banana Ripener
Dairy/Dairy Products
Wet mixing - no cooking
Dry mixing – no cooking
Food -
Cooking
Wet mixing – cooking – wet heat e.g. boiling/steaming only (jams, fruit fillings
Wet mixing – cooking – dry heat e.g. ovens
Dry mixing – cooking - dry heat e.g. ovens -
Frying/Deep Fat Frying
Smoking/Curing
Food – Heating/dryingMalting, other drying or heating processes for example, powdered milk made by
evaporating milk and drying by heating.
Drinks
Soft drink mfr
Drinks: Alcoholic – spirits ex whisky
Drinks: Alcoholic – Whisky
Drink mfr: Alcoholic ex spirits. Inc vinegar brewery
Aviva: Internal
Other Considerations…
Unattended operations
• Delay between faults & human intervention.
• Ovens in bakeries pre heated prior to cooking quite common
• Frying ranges – left to heat up or interruptions during oil changes/cooking periods without supervision
• Temperature monitoring/cut off devices essential but not always the total solution
Staff Issues:-
• At times of peak production/output standards can suffer
• Training and inspections of work can be time consuming to maintain
• Staff/labour in short supply or high turnover can make it difficult to maintain standards
• Use of agency staff, staff on zero hour contracts or with language limitations
Waste removal
• strict procedures
• non combustible receptacles
• frequency
• outside storage
Storage•
• Combustible using plastic (HDPE) pallets or ones made from card/paper/glue!
Strict cleaning and
housekeeping regimes
and their enforcement
are critical
Thanks for listening
Questions welcome
?
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