APC 2007 Annual Report Download - page 35
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33
Description of the Company and its businesses
1
curity plans. As concerns risks of average frequency and
intensity, the Group also has ongoing programs to prevent
traffic accidents and work accidents and reduce trans-
portation risk.
Organizing and deploying crisis management resources,
notably for technical and political risks and natural disas-
ters.
Maintaining the necessary insurance cover for the main
risks facing Group companies (civil liability, property dam-
age and business interruption, environmental accidents
and transportation risk), under global programs. The Group
continues to carefully screen insurance and reinsurance
companies and evaluate their solvability. To maintain es-
sential levels of cover while also optimizing insurance costs
in light of constraints in the insurance and reinsurance mar-
kets, the Group has adopted a policy of self-insuring a cer-
tain number of recurring risks, whose frequency and
financial impact can be reliably estimated (primarily auto-
mobile risks). Through its reinsurance subsidiary, the
Group covers moderate property damage, business inter-
ruption and civil liability risks. The amounts involved are
not material at the consolidated level.
In addition, the Group has taken out specific cover in re-
sponse to certain local conditions, regulations or the re-
quirements of certain risks, projects and businesses.
In 2007, the Group carried out a major globalization pro-
gram to:
Increase insured values.
Harmonize guarantees.
Simplify the structure of current programs.
Optimize administrative and brokerage costs.
Reduce budgets.
Liability insurance
The Group is covered by an integrated global liability in-
surance program set up on January 1, 2007. Insured val-
ues under this program total 230 million, representing
adequate coverage of the Group’s exposure to liability
claims in connection with its businesses.
Property and casualty/business
interruption insurance
Following a competitive bidding process, the Group imple-
mented a global property and casualty/business interrup-
tion insurance program on July 1, 2007 that includes the
North American Operating Division. Aggregate settlements
under the global program are capped at 350 million and
specific limits apply to certain risks, such as earthquake
damage and machine damage.
Shipping and transport insurance
On January 1, 2008, the Group implemented a global ship-
ping/transport insurance program that includes the North
American Operating Division. The program covers all
goods shipments, including between Group facilities, by all
means of transport, with a maximum insured value of
15.2 million per convoy.