By: Luke Jones, Published on September 28, 2017 07:28 AM, Last Update on September 28, 2017 04:31 AM
Insurance companies are concerned by major events like nuclear incidents and terrorism, and one way to help would be to do a better job of categorizing risk. That’s according to chief executive officers speaking to risk managers at a Wednesday event in Toronto.
“Climate change poses a significant risk for us, not just because the losses are going up but the mitigation and adaption of society is not keeping pace with the speed of climate change,” argued Philipp Wassenberg, president and chief executive officer of Munich Re Canada.
“What keeps us up at night as well is terrorist attacks and we see that because it has widely come back to the portfolio” since the September 11, 2001 hijackings, Wassenberg suggested. He was speaking during the CEO Panel Plenary, held Wednesday at the RIMS Canada Conference at the Metro Toronto Convention Centre.
“There is tremendous exposure from terrorist attacks and it is very difficult to assess,” Wassenberg said.
Terrorism remains a real threat on a global scale. The 2017 Terrorism and Political Violence Risk Map report from Aon plc shows there was a 14% increase in terror attacks through 2016.
“The continued existence of Islamic State (IS) in Syria and Iraq has directly contributed to a sustained and worsening terrorist threat overseas,” Aon pointed out at the time. “Despite coming under intensified military pressure in these countries and sustaining significant battlefield losses, particularly in Iraq, the group continues to pose a serious regional and international terrorist threat.”
Joining nuclear incidents and terrorism as the four more worrying man-made threats facing insurers are power outages and a market crash. Sean Murphy, CEO of Lloyd’s Canada says cities are growing and more of the global population is located in cities than ever before:
“The concentration of wealth, in those city centres, has put our economy heavily exposed to man-made and natural disasters,” Murphy said, adding “the top two in the emerging threat category” are human pandemic followed by cyber breaches.
“About 50 million people died in one year in Europe in 1918,” Wassenberg commented on that year’s flu epidemic. “That outnumbered the deaths in four years of World War 1 victims,” Wassenberg concluded.