Brokers must interrogate supply chain resilience at renewal
Firms trading across Africa operate in an environment where infrastructure shortcomings, logistics bottlenecks and regulation routinely interrupt the movement of goods. The risk management decision makers at these firms, and the brokers representing them, need a clear understanding of how the firm monitors and plans for potential supply chain disruptions to secure the best possible terms during underwriting negotiations.
Conscientious oversight is non-negotiable
A recent Institute of Risk Management South Africa (IRMSA) executive engagement session, held in Johannesburg, illustrated the extent to which insurers are aligning capacity, premium and terms to clients’ oversight of supply chain risk. Today’s newsletter shares insights from a presentation titled From Reactive to Proactive Supply Chain Management: Rethinking Supply Chain Resilience, delivered at the hybrid event by Sapna Amlani, Senior Director: Industry Practice Lead Supply Chain at Moody’s.
The executive engagement session also served as a platform for the formalisation of a partnership between IRMSA and Moody’s, which IRMSA Chief Executive Officer Yvonne Mothibi introduced as a long-term collaboration aimed at embedding risk intelligence into the operating models of African and South African firms. She linked the initiative to a broader ambition to improve how firms are assessed, governed and ultimately underwritten, all factors that contribute to meaningful underpins for economic growth.
Amlani’s 40-minute presentation was awash with Moody’s risk intelligence solutions, but there was an undercurrent of facts and figures that helped your writer whip together an FAnews risk management and underwriting informer. Notably, the presenter exposed some of the operational difficulties facing freight and logistics firms in Africa, and the manufacturers and retailers who rely on them. Domestic brokers are quite familiar with some of these challenges which include crime, delays at ports and freight terminals, poor road and rail infrastructure and power failures.
Port infrastructure under constant strain
The logistics outlook is blurry at best. In 2023, Durban saw container volumes fall by around 30% at points, driven by strikes and equipment failures. Peak vessel waiting times often stretched to six to eight days at Durban, while winter winds in Cape Town can cause delays of three to five days. Meanwhile, South Africa’s inland depots experience frequent, multi-hour truck queues. These challenges are commonplace for goods transit across sub-Saharan Africa, where container dwell times sit at two to three times OECD benchmarks.
Issues at Eskom and Transnet are well documented locally, as is crime. Rail derailments and equipment failures have pushed freight back onto road networks, increasing cost and exposure for transport-intensive sectors. Despite Transnet spending around R24 billion on capex in its latest financial year, volatility remains a feature of port performance. The presenter also noted that more than 1 800 truck hijackings were reported in South Africa in 2025, while cable theft caused damage to Transnet rail infrastructure totalling over R250 million.
Beyond South Africa’s borders, disruption often stems from geopolitics or regulation. Amlani gave an example in which sanctions forced a mining exporter to reroute via Dar es Salaam, doubling delivery times and driving insurance premiums nearly 30% higher. In another, a ransomware attack halted a logistics provider for three days, disrupting downstream supply chains and imposing significant financial cost on affected clients. In each case, the loss did not stem from the disruption alone but from the absence of early visibility and structured responses.
Advocating for proactive risk postures
“Reactive supply chains wait; proactive supply chains read the signals,” Amlani said, arguing that the distinction lies in whether firms have the visibility to act before a disruption translates into delayed deliveries, missed shipments or insurance notifications.
She asked the audience whether their organisations had experienced material port or inland logistics delays in the past 12 months, whether these disruptions had originated beyond tier-one suppliers (being the firm’s direct contracted suppliers who often rely on tier-two and tier-three providers further upstream), and whether visibility only ‘arrived’ after the event. The consistent issue, she suggested, is timing.
Intermediaries advising on business interruption (BI), contingent BI, marine cargo, political risk and trade credit covers need insight into their client’s risk intelligence capabilities during underwriting discussions. Insurers are increasingly concerned not only with the existence of supplier contracts and contingency plans but with the quality of real-time monitoring and the depth of supplier visibility. Firms that can demonstrate oversight beyond tier-one suppliers in addition to integrated sanctions screening, beneficial ownership checks and corridor monitoring present better risk profiles than those that rely on manual tracking and retrospective reporting.
Amlani described how predictive dashboards that integrate real-time customs status, port dwell times, rail performance and supplier health allow firms to detect and respond to stress points. In one example shared during the session, a South African retailer identified early warning signs in a tier-two supplier and secured alternative capacity, avoiding supply disruption at the store level. In another, a Johannesburg manufacturer used live port and rail data to reroute via Maputo during congestion, protecting a product launch timeline.
Managing supply chain risk accumulation
The broader point is that the accumulation of events alters how insurers assess operational risk in underwriting decision-making. Disruptions that were once treated as episodic are now being evaluated as systemic, particularly in sectors dependent on concentrated corridors or single-node (sole-source) suppliers. The underwriting conversation therefore shifts from whether disruption may occur to how quickly a firm can detect, escalate and respond when it does. Flexibility in response reduces the need for a claim and indeed the extent of loss should a claim arise.
Firms can respond to dynamic risks by mapping corridor dependencies, pre-qualifying secondary ports and suppliers and formalising escalation protocols across their logistics and procurement functions. The challenge is to demonstrate preparedness during discussions with brokers and underwriters, shifting the firm’s default from post-event scrambling to a clear ‘plan B’ should a disruption occur. One example is through corridor optionality, a topic that featured prominently during the presentation.
Corridor optionality, in Amlani’s framing, is the practical discipline of building redundancy into routing decisions before a disruption forces a reroute. Durban remains central to South Africa’s container flows, but throughput through this port has fluctuated despite significant capital investments. Firms are thus considering alternative hubs such as Maputo or Walvis Bay to preserve continuity. Those that pre-qualify secondary ports, diversify logistics partners and secure standby capacity are better positioned to respond to unexpected shocks.
The underwriting value of a ‘plan B’
Brokers advising clients in manufacturing, mining or retail can integrate a client’s ‘plan B’ into the insurance discussion For example, BI exposure is shaped by supplier concentration and transit dependency, while marine cargo risk reflects route selection and port performance. Governance is featuring in renewal discussions too and underwriters want clients to evidence structured monitoring across cyber vulnerability, sanctions exposure and supplier stability.
Increased digitisation of customs processes, expanding sanctions regimes and rising ESG disclosure requirements are raising the bar for how supply chain activities are governed. According to Amlani, compliance and governance must be embedded across contracting, payment, scheduling and supplier onboarding workflows. “Sanctions and beneficial ownership checks cannot be periodic hygiene tasks; they must be embedded into your daily decisions,” She said. Put differently, regulatory resilience has become a core operational function.
In closing the session, Mothibi held up the partnership between IRMSA and Moody’s as part of a broader shift in how firms approach risk. She said firms that embed risk intelligence in their operating frameworks will see tangible improvements in governance and operational outcomes. IRMSA members were encouraged to build visibility across supply chains as a prerequisite for sustainable participation in today’s complex regional and global trade corridors. Brokers can do their part by using renewal discussions to challenge clients on risk posture.
Writer’s thoughts:
Supply chain resilience is becoming integral to underwriting discussions, with insurers scrutinising risk exposures across trade corridors and supplier bases. Do you assess your clients’ supply chain monitoring and contingency planning during renewal discussions? Please comment below, interact with us on X at @fanews_online or email us your thoughts [email protected].
