The worst floods for decades have caused major problems for Japan’s commercial operations due to extensive shutdowns across affected areas.

Some of the country’s most well-known companies, such as Panasonic and Mitsubishi Motors, are among those affected. The prolonged disruption to the country’s manufacturing facilities is expected to lead to significant business interruption losses. Aon has suggested that the costs of damage to property – current reports indicate 12,000 properties have been damaged or destroyed although this figure is expected to increase – as well as to vehicles and infrastructure could cost “substantially into the hundreds of millions of dollars, and almost certainly higher."

The ability of Japan’s manufacturing operations to recover quickly will be governed by extent of the damage to its transportation network and infrastructure. This will also be important in assessing the impact of business interruption.

Whilst numerous facilities remain closed, some due to fears for worker safety or interference with their supply chains, rather than as a result of actual property damage, the situation remains at risk of yet further deterioration as the rainy season continues.