Risk-based management came into its own in the 2008-2009 financial crisis, amidst huge market turbulence and massive government intervention, according to Anthony Bice and Michael Moloney, Partners in Oliver Wyman’s Financial Services group and Head of EMEA Insurance and Americas Insurance, respectively. Add fear for human life and deliberate restriction of normal societal functioning and you’ve got today’s novel coronavirus (COVID-19) pandemic — negatively impairing almost all financial and operational aspects of businesses at once.
Oliver Wyman is optimistic that containment efforts underway across major geographies and zones will be able to check the first wave of the pandemic within months. This initial success, however, will mean that proportions of local populations infected and recovered by summer will be well below what is necessary for “herd immunity.” As a result, iterative and potentially uncontrolled cycles of outbreak and containment will continue to play out at varying intervals and speeds globally until an effective vaccine is available (not likely for another 18 months at a minimum, and potentially much longer). Oliver Wyman is an affiliate of Guy Carpenter.