Even companies that have taken steps to make their own systems Y2K compliant are likely to be impacted by failure in the systems of those upon whom they rely. For example, many are predicting that manufacturers will experience disruptions in their supply chains caused either by vendor failures or failures in the transportation industry. In addition to losses caused directly by Y2K failures, many anticipate a substantial wave of litigation arising out of the Y2K problem. Potential litigation scenarios include derivative claims against officers and directors of corporations which fail to adequately plan for the Y2K problem, securities fraud and other claims against companies and persons who fail to properly disclose potential Y2K problems, fraud and consumer protection claims against the manufacturers and sellers of non-compliant goods and products, and professional negligence claims relating to Y2K failures. The precise impact of the Y2K problem is unknown.
Predictions vary widely from delay and inconvenience, to worldwide recession.
The only certainty is the need for proper planning. Most Likely to be Affected . Both liability and property coverages may be substantially impacted by Y2K claims. In the third party liability insurance area, lines under which claims may be anticipated include general liability, products liability, errors and omissions, directors and officers and manufacturers' liability. First party property insurance coverages, including inland marine and ocean marine, can expect claims for property damage, business interruption and extra expense.