February 03, 2021
As a number one priority for the new Biden administration, the U.S. is continuing to ramp-up its efforts for the production and delivery of COVID-19 vaccines.
The mass rollout, coupled with an already depleted supply chain market due to COVID-19’s impact on the e-commerce boom and holiday season, could be the biggest logistical challenge the nation has seen. It leaves many grappling with the question, “Is the transportation and delivery network able to handle the last-mile delivery?”
Last-Mile Delivery Challenges
Even though there are big brand names attached to the vaccine distribution plan at a high level, at a tactical level, there are many moving parts that make delivery tricky. For example, if CVS or Walgreens is getting a vaccine shipment, a truck from the manufacturer will bring the vaccines to a local distribution center, where they will then be divvied up and rolled out to the area through last-mile delivery drivers.
The biggest issue is that they can’t be transported via any kind of delivery vehicle. These vaccines must be kept refrigerated at specified, ultra-cold temperatures – from warehouse, to distribution center, to the final location. Along with the other issues plaguing the delivery network, finding a large amount of the transport vehicles that can accommodate these requirements is another factor of how it could bottleneck the vaccine delivery process.
It also opens the door for liability exposure. What are the repercussions if someone is administered a vaccine that dipped below the required transit temperature and had adverse effects? Will the delivery company be held liable?
Additionally, as a high-profile item, there’s a greater chance for loss and theft exposure. The rollout process isn’t quick, opening vulnerabilities for criminals to target delivery drivers and orchestrate theft rings.
Insurance Concerns
Due to the government’s involvement with this rollout, there has yet to be a value attached to the vaccine on a dosage basis. Therefore, insurance carriers are having a hard time setting a standard for what a policy looks like to cover any possible claims or losses.
Similar to the above questions, what’s the value if any vials are lost or stolen? Who’s held liable in these scenarios – the delivery company, the shipment packer or the vaccine producer?
Additionally, if anything negative does happen, will the insurance carrier and delivery company automatically be held responsible for a large settlement in the event of a claim or lawsuit given the heighten awareness of the pandemic and vaccination plan?
There’s a lot of questions with very few answers, causing many insurers to be hesitant to cover this risk and instead, put vaccine exclusions on cargo insurance policies.
While this issue will likely get worked out in the future, it’s important to know if and how you’re covered now should you decide to move the vaccines. It’s a windy road ahead, but the Risk Strategies Transportation team is here to help guide you. Get in touch.
Want to learn more?
Find me on LinkedIn, here.
Connect with the Risk Strategies Transportation team at transportation@risk‐strategies.com.
Email me directly at bjungeberg@risk‐strategies.com.
