Keeping up with an evolving strategic risk landscape

The insurance sector is at an interesting juncture, as the nature of the strategic risks facing the sector evolves and anticipated time-frames for change shorten. At first glance, it is a sector populated by well capitalised, established and large incumbents. It is a sector selling products that consumers need - and are likely to need more of in the future. And yet, for all those positives, one also gets the sense that this is also a sector ripe for potential disruption.

This year’s theme of Aon’s Hazards Conference being (R)evolution of Risk is an apt one. As our climate, society and technology changes at an ever increasing rate, our ability to understand and to price risk effectively becomes more challenging. This, coupled with growing expectations from customers creates a climate where non-traditional market players, who don’t necessarily think like insurers, can enter the fray.

This (R)evolution requires that we shift gears for how we think about and manage risks. None of us has a crystal ball. Odds are, the changes that hit us will not be the ones we are expecting. We know that our traditional ways of managing risks aren’t very effective at dealing with left-field events (the unknown unknowns). To deal with these sorts of risks, we need to focus more on shoring up the key attributes that grow resilience in an organisation: building a solid foundation of good leadership and culture throughout our organisations; focusing on building networks and relationships that provide support and buffering during times of turbulence; and fostering an organisational attitude and posture that is proactive and positive towards change. There is no rocket science about these three fundamentals – they are talked about in just about every management textbook. But all too often good practice isn’t common practice.

The innovation, creativity and adaptability that will be needed to ensure products, services and service levels adapt to what we cannot see coming needs to be built now, by focusing on those core building blocks.

When was the last time you really took a hard look at how your organisation measures up on these fundamental aspects of resilience?

Erica is an Executive Director with Resilient Organisations and a Commissioner on the Board of the Earthquake Commission (EQC). Erica will be presenting on day two of the (R)evolution of Risk 2019 Aon’s Hazards Conference about four key challenges facing the insurance sector, and what we need to be doing now to address them. For more details, visit: https://www.aon.com.au/australia/hazards-conference-2019

Erica Seville

Executive Director, Resilient Organisations

12.15pm-12.45pm

Wednesday 25 September