Cover for the business interruption suffered by the insured as a result of a loss occurring not at its own premises but at a supplier or provider on which it depends.
Contingent business interruption is a cover that responds to the business interruption suffered by the insured when the event at its origin occurs not at its own premises but at a third party on which it depends, a supplier, subcontractor, service provider or even a major customer. It recognizes a fundamental economic reality, namely that a company can be paralyzed without having itself suffered the slightest damage, by the mere failure of a link in its chain. In cyber, this cover takes on decisive importance, because organizations' dependence on a small number of critical digital providers, hosts, cloud computing suppliers, vendors of widely used software, means that an attack or an outage at one of them can simultaneously interrupt the activity of a large number of companies. Contingent business interruption is thus at the heart of accumulation risk, since the failure of a common supplier triggers a large number of correlated losses among insureds with no apparent link between them. It is precisely this concentration of dependencies that makes the cover as sought after by insureds as it is feared by insurers, which struggle to map their real exposure to shared critical suppliers.
An online retail company whose activity rests entirely on a cloud computing provider is paralyzed when the latter suffers a major outage. It has suffered no direct attack, but its business interruption falls under the contingent business interruption cover.
carence fournisseur, contingent business interruption, CBI, perte d'exploitation sans dommage direct