Insurance Advisory for A Spinning & Yarn Manufacturer

This case study explores how insurance advisory helped a yarn manufacturer secure the right mix of fire, machinery breakdown, and business interruption coverage. Beyond textiles, manufacturers across industries face similar risks—making tailored insurance advisory a critical business safeguard.

How our no-nonsense approach helped a client to claim their insurance efficiently, effectively, & (almost) effortlessly.

The client suffered a loss due to an outbreak of fire in a Fully Pressed Cotton Bales Go-down.

✅ Accounting details.
✅ Closing Stock of FP Cotton Bales in their accounting software.
✅ Go-down Register containing details of the Incoming & the Outflow of FP Cotton Bales.

• The Go-down Register maintained by the insured was destroyed in the fire.
• No records were kept of the waste generated during the spinning process.
• The client was unable to substantiate the quantity of FP Cotton Bales claimed in the formal claim bill they submitted.
• The lack of proper record-keeping made proving the loss difficult.

• We leveraged the “Reverse Material Balance Method” by converting all the various closing stocks of Finished Goods, Work In Process into FP Cotton Bales.
• During this process, we also considered the opening stock of FP Cotton Bales, the work In process, as well as finished goods.

• It was concluded that there was no malafide intention of the insured in regard to the causes of loss, and the loss sustained was real.

The insurers were convinced by our methodology & appreciated the efforts for finding an amicable and acceptable solution.

Want to strengthen your insurance strategy? Contact RNC Valuecon LLP for specialized advisory across manufacturing sectors.

1. Why do manufacturers need insurance advisory?

Manufacturers face multiple risks—fire, machinery breakdown, supply chain disruptions, and liability claims. Insurance advisory ensures the right coverage mix and reduces gaps in protection.

2. What are common risks in textile plants?

Textile plants face high fire hazards (cotton dust, storage), machinery breakdown risks, labor-intensive operations, and business interruption due to raw material or export delays.

3. How does business interruption insurance help manufacturers?

It compensates for lost income during downtime caused by fire, machinery breakdown, or insured events—helping maintain cash flow and operations.

4. What role do insurance advisors play during claims?

Advisors assist with documentation, loss assessment, insurer coordination, and ensure claims are settled fairly and on time.

5. Can insurance advisory be customized by industry?

Yes, advisory is tailored—textiles focus on fire/dust hazards, food units need contamination cover, and chemical plants require environmental liability.