Insurance panel considers new emerging risks
From asbestos to algorithms, ethical handling of data and loss of sleep — the 2018 Swiss Re SONAR, new emerging risk insights report aims to identify the risks that may have a major impact on the insurance industry in the future.
Annette Kurtzweil, chief risk officer, Swiss Re Corporate Solutions North America, presented the report's findings at the PwC Insurance Summit.
There was also a deeper discussion on emerging risks with panellists David Bigley, chief underwriting officer and head of global catastrophe insurance, Sompo International; Judy Gonsalves, vice-president, Chubb Group and division president, Chubb Bermuda; and Noel Pearman, cyber product line leader, Axa XL Bermuda.
Ms Kurtzweil noted the continuing impact of asbestos on the industry, with millions of metric tonnes of asbestos still being processed and 300 million people in Europe and Central Asia potentially exposed, and Latin America and other regions also at risk.
The panel examined this and other risks that are emerging as insurance and reinsurance firms increasingly wade into new underwriting territory, including trends in new product development, climate-related risk, cybersecurity, and other new technologies.
The conference heard how insurers and reinsurers are looking at such emerging risks as 3D organ printing, the insurance consequences of algorithms and lack of sleep, the development of products to solve the protection gap and the use of drones for analytics.
A PwC report estimates the addressable market of drone-powered solutions in the insurance industry at $6.8 billion, stating: “One excellent example of drone applications in the insurance sector is their use in monitoring areas exposed to natural disasters such as floods, droughts, volcanic eruptions or hurricanes. Other uses include risk assessment and claims management.”
Swiss Re identifies emerging risks through its proprietary SONAR tool, an internal crowdsourcing platform that allows for collecting input and feedback from underwriters, client managers, risk experts and others across the company.
Swiss Re said the emerging risk themes outlined in the report are based on early signals collected throughout the year. They neither reflect the entire emerging risk landscape of the insurance industry nor that of Swiss Re. They have been categorised according to their estimated impact and potential timeframe to materialise as well as to the line of business where the biggest exposure seems to rest.
In the report, which has been publicised annually since 2013, Swiss Re says the 18 new emerging risk themes are complimented by seven emerging trend spotlights, and embedded into a broader perspective on long-term macrotrends.
The PwC Insurance Summit was held at the Hamilton Princess Hotel and Beach Club.