Global Climate Regulation Looms on the Horizon. Are Banks and Insurers Ready? Many of the world’s leading banks and insurers are busy finalizing their response plans to the Bank of England’s innocuous-sounding supervisory statement number SS3/19. It sets out the regulator’s expectations for how banks and insurers should manage the financial risks of climate change, including modification of governance and risk management frameworks, development of scenario analyses and stress testing, and disclosure of climate-related risks.
The Changing Nature of Risk: Today, the (re)insurance sector operates in a rapidly changing and uncertain world. Elevated levels of VUCA – volatility, uncertainty, complexity and ambiguity – are unlikely to relent any time soon. In fact, the impending degree of change over the next decade looks set to transform the risk landscape like never before.
Guy Carpenter and CyberCube Report Reveals Potential Impact of Cyber Catastrophe Scenarios on U.S. Cyber Insurance Industry: Guy Carpenter and CyberCube Analytics released the findings of a joint report that explores the size and shape of potential cyber catastrophes and the resulting financial impact on the U.S. cyber insurance market. The report, “Looking Beyond the Clouds: A U.S. Cyber Insurance Industry Catastrophe Loss Study,” examined some of the key drivers of cyber catastrophe scenarios and provided a data-driven view on the potential insured loss figures for the standalone cyber insurance market. It also highlighted particular vulnerabilities that could be exploited to execute a cyberattack and explored the volatility around the frequency and severity of those attacks.
CAT-i Bulletin: Hurricane Lorena: In the East Pacific Basin, Hurricane Lorena affected the Pacific Coast of Mexico south of Puerto Vallarta before approaching the Baja California Peninsula as a category-1 hurricane over the weekend. Initial media reports indicate some flooded homes and roadways along with some property damage due to wind for affected areas.
Chart: Global Property Catastrophe ROL Index: The Guy Carpenter Global Property Catastrophe Rate on Line (ROL) index is presented for 1990 through 2019.
And, you may have missed ….
Dedicated Reinsurance Capital: First Half 2019: With the majority of 2019 reinsurance renewals now complete, the impact of significant catastrophe activity has evolved from a year ago. Capital inflow levels and risk appetites are responding accordingly. Crucially, alternative capital dipped slightly in the first half of 2019 for the first time since 2012 to USD 92 billion as investors responded to evolving risk measures and loss experiences over the last 12 months.
