For many businesses, the greatest financial consequence of a major property loss is no longer the physical damage itself, but the disruption that follows. Across the Middle East, where many organisations rely on specialist machinery, imported components and international supply chains, early operational and financial intervention can significantly reduce both the duration and cost of a business interruption claim.
A recent major loss in the UAE demonstrates how bringing together loss adjusters, forensic accountants, insurers and policyholders from the outset can materially reduce both the scale and duration of a business interruption claim, while helping businesses preserve customer relationships and operational resilience.
Looking beyond the property damage
The loss involved a specialist fast-moving consumer goods (FMCG) packaging manufacturer serving customers across the Gulf region. Following a major fire affecting its primary production line, the business lost a highly specialised finishing capability performed by imported European machinery. While other production activities could continue, the damaged equipment was central to fulfilling many of the company’s highest-value customer orders.
The immediate exposure therefore extended well beyond the physical damage itself. The business operated in a highly competitive market where customer retention depended on service continuity, production quality and speed to market. A prolonged interruption risked not only lost turnover, but also the erosion of long-standing customer relationships and market share.
Understanding these operational dependencies became the priority from the outset. Early discussions focused not simply on the damaged machinery, but on which products generated the greatest contribution, which customers were most vulnerable to switching suppliers, what mitigation options were realistically available and how quickly they could be implemented.
Early collaboration changes the outcome
From the earliest stages of the claim, McLarens’ forensic accounting team worked alongside the loss adjuster, enabling operational and financial considerations to be assessed together rather than sequentially. This avoided duplicated information requests and allowed discussions with the insured to focus on understanding the business rather than simply gathering financial information.
Rather than waiting months to calculate the final quantum, the forensic accountants immediately analysed customer concentration, operational dependencies, contribution margins and alternative recovery scenarios. Working alongside the insured, brokers and insurers, they evaluated a range of mitigation strategies, including sourcing replacement equipment internationally, engineering modifications, outsourcing specialist production, increased overtime and alternative logistics arrangements.
Crucially, this analysis took place while mitigation opportunities still existed. It enabled insurers and the insured to make informed commercial decisions based on the likely reduction in business interruption exposure, rather than simply considering the immediate cost of each option.
One such decision was to source and modify a second-hand production unit to restore part of the specialist finishing capability significantly earlier than would otherwise have been possible. Although this involved substantial upfront expenditure, engineering work and additional labour costs, the cost was considerably lower than the potential financial impact of losing key customer relationships during a prolonged interruption.
A regional perspective
This collaborative approach is particularly valuable across the Middle East, where many businesses remain dependent on imported machinery, overseas technical expertise and international supply chains. Recovery periods can be extended where bespoke equipment, specialist commissioning or cross-border logistics are required, while geopolitical instability and disruption to shipping routes can further delay the delivery of replacement components and engineering support.
Many industries also operate in highly relationship-driven markets where prolonged disruption can quickly result in the loss of customers and market share that may prove difficult to recover. Understanding those commercial realities is therefore just as important as assessing the physical damage itself.
Lessons for insurers
The UAE case demonstrated the tangible benefits of early collaboration. Key customer relationships were maintained, operational capability was restored in around four months rather than a potential twelve months or more, reserves remained stable throughout the adjustment process, and the projected business interruption loss was reduced by an estimated AED 7–8 million. Most importantly, the business avoided the longer-term commercial damage that could have extended beyond the policy’s maximum indemnity period.
As business interruption claims continue to evolve, the role of the claims team is evolving with them. The greatest value is no longer created solely by accurately measuring losses after an incident has occurred, but by helping businesses reduce those losses before they fully develop. By bringing together adjusters, forensic accountants, insurers, brokers and policyholders from the earliest stages of a claim, organisations can make informed operational decisions while mitigation opportunities still exist – improving business resilience while delivering better outcomes for insurers and insureds alike.
