Reinsurance Implications of the United Kingdom’s Business Interruption Test Case: On January 15, 2021, the UK Supreme Court issued its widely anticipated decision in the Financial Conduct Authority’s business interruption (BI) test case. The FCA brought the test case to resolve uncertainty for certain BI policyholders affected by the COVID pandemic. Although the Court ruled that some forms of BI insurance cover COVID losses, the Court adopted a narrow definition of a COVID “occurrence” — an illness suffered by just one person or arguably several people in one household — that has raised questions about the meaning of the word “occurrence” in other contexts.
CAT-i Bulletin: February 2021 U.S. Arctic Air Outbreak: An intrusion of Arctic air into the central and eastern United States has brought periods of record-setting cold to areas as far south as the Southern Plains. Along the boundary between cold and warm air, several impactful winter storms have crossed from the Southern Plains into the Mid-Atlantic over the recent two weeks.
Chart: Significant Insured Catastrophe Losses 2011 – 2020: Based on Guy Carpenter tracking, large losses generated near USD 80 billion of loss in 2020, an above-average number without considering COVID-19.
Institutional Structures for Community-Based Catastrophe Insurance Solutions: Community-based catastrophe insurance solutions have the potential to enhance the financial resilience of communities and their residents, provide affordable and reliably available disaster insurance, and create incentives for community-level and individual risk reduction.
Cyber Risk: The Emerging Cyber Threat to Industrial Control Systems: Lloyd’s, in partnership with Guy Carpenter and cyber analytics specialist CyberCube, has launched a new report, The Emerging Cyber Threat to Industrial Control Systems, which provides an original analysis of potential cyber-attack pathways to an industrial target.
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Future Preparedness for Global Risks: While global risks outlined in the Global Risks Report, published by the World Economic Forum with support from Marsh & McLennan, are dire, lessons from COVID-19 offer an opportunity for mitigation. Global risks — pandemics among them — crystalize differently, but cross-cutting capabilities and systemic approaches to strengthen the overall resilience of countries, businesses and the international community are possible. The response to COVID-19 so far offers at least four governance opportunities.