Emerging risks: Building into insurance decision planning mechanisms

In a world suddenly confronted by social distancing, dialogue becomes ever more important. Swiss Re Institute's Executive Dialogue Series (EDS) brings together Swiss Re executives and external experts in virtual dialogues with valued senior clients to discuss challenges across lines of business and operating environments. With a global audience, and operating in different time zones, the EDS will hold two dialogue sessions per month on key topics that will help us navigate the post-COVID-19 world.

Frequently, however, these plans were directed against other illnesses; and the relative unfamiliarity of an air-born disease with a high mortality rate may have bred an atmosphere of poor understanding or even complacency. A white, rather than a black swan event, but one that underestimated the risk of novel corona viruses and their potential knock-on effects.

No one is complacent of Covid-19 now. The danger is rather that Covid-19 overshadows other emerging risks. Most notable of these is climate change, hardly a new topic, but the urgency of which grows with every passing year. The climate targets set by the 2016 Paris Agreement, already endangered by political dispute, cannot be reached alone by decarbonising production processes. Some form of atmospheric carbon capture and storage will be needed to hit Paris, and insurers are exploring risk profiles that will be associated with this emerging industry. 

In our virtual one-hour dialogue, we will ask and discuss:

• How can insurers create processes that capture emerging risks and model the effects they might have on underwriting portfolios?
• How can these processes enhance ESG processes within insurers, increasingly demanded and expected by regulators and investors? 
• Using case studies such as Covid-19 or climate change, how can insurers best manage the crystallisation of emerging risks?