Five Emerging Risks You Need to Know About

Five Emerging Risks You Need to Know About
As the world turns the page on another decade, it’s time to look at what lies ahead. In the insurance industry, that means it’s time to explore emerging risks. Sure, everyone can predict that there will be natural disasters, seasonal fires, engineering errors and accidents. But are you prepared for these five emerging risks?
1. Climate Change
Back in 2018, The Wall Street Journal published an article about how climate change was forcing the insurance industry to change the way it was doing business. The emerging issue was affecting the way companies dealt with everything from planning to underwriting to everything in between.

It’s still the number one insurance risk–across the country and around the world.

According to the Insurance Information Institute, climate change is negatively affecting everything from the global economy to ecology to human health. The organization goes on to say that insurance organizations have yet to fully understand how climate change will affect the industry in coming years.

But they are sure it will.

2. Cyber Security
Cyber crime is the current scourge of today’s society. According to the FBI, cyber crime costs the global economy billions of dollars each year.

And it’s insurance companies that are often left holding the bag.

Cyber criminals hide in the darkest corners of the internet, stalking victims around the world. And they don’t discriminate. They go after individuals, businesses small and large, government agencies, non-profit organizations and anyone else who has anything they want.

It also doesn’t look like the criminals are going to stop any time soon, which is why this emerging insurance risk is one that you need to be aware of and take precautions to protect yourself from.

3. Natural Resources Management
How much can society take before the natural resources are depleted? That is the question government leaders, businesses and the insurance industry is asking itself.

As the world’s population continues to grow, more fresh water, soil, clean air, food and oil, gas and other natural resources will be required to sustain communities, much less help them grow.

As managing these often limited resources becomes more critical, the issue will present both challenges and opportunities for the insurance industry. Those organizations that understand the issue best will likely be those that continue to thrive.

4. Artificial Intelligence
If there is one innovation that has the potential to change the insurance industry in ways that could not have been imagined even 10 years ago, it is artificial intelligence.

It’s easy to see how it could change customer service–both “in person” and online. But can you imagine a world where artificial intelligence replaces claims adjusters?

That could be a Jetsons-like pipe dream, but it’s worth considering how artificial intelligence could affect your business model (and that of your clients) today, tomorrow and well into the future.

5. The Elections
A presidential election always represents an insurance risk. Regardless of who wins, there will always be a group of people who feel disenfranchised. It also always leads to policy changes, and there is always a lot of uncertainty about what comes next.

That’s why you should have contingency plans in place.

Are You Ready for 2020?
If you are looking for a partner who is ready to help tackle today’s challenges and also thinking about what comes next, connect with Insurance Risk Services today.

You can’t predict the future, but together you can make sure you’re prepared for everything.

We’re delighted to announce that Insurance Risk Services will rebrand to Davies in the near future.

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