The SONAR process
To identify emerging risks and address their potential impact on our business, we operate a tailor-made, Group-wide framework called SONAR.
We define emerging risks as newly developing or changing risks that are difficult to quantify and whose potential impact on our business is not yet sufficiently taken into account. Key drivers include new demographic, economic, technological, socio-political, regulatory and environmental developments are all capable of changing risks or creating new ones. In addition, growing interdependencies between these developments can lead to accumulations of risk and create significant knock-on effects. People's risk perceptions are shifting, liability and regulatory regimes continue to evolve and stakeholder expectations are growing.
Our SONAR process
SONAR (systematic observation of notions associated with risk) is our Group-wide process specifically designed to manage and communicate emerging risks. Firmly embedded in the Group's risk management organisation, SONAR allows us to identify, assess and report these risks in a timely manner and to factor them into our decisions. The key is to reduce uncertainty and prevent unforeseen losses.
First step: an interactive information platform
The SONAR process involves several steps. The first is an interactive intranet platform which enables our employees to share and discuss risk notions based on developments in the re/insurance landscape, allowing for bottom-up identification and peer reviews. While many of the risk notions – or "early signals" – flagged on the SONAR will never turn into emerging risks, others may well do so. However, as we cannot anticipate which signals will become emerging risks, we scan the horizon quite broadly before concentrating on those with the highest impact potential on the re/insurance business.
Second step: clustering and further assessment
Our emerging risk specialists periodically cluster and further assess these risk notions for their potential impact on our business. Finally, in-depth investigations are carried out on selected topics.
Our SONAR Report
To share some of our key insights on emerging risks with external audiences, we regularly publish our comprehensive Swiss Re SONAR report. You can access the latest edition below.