COVID cases rise, but other systemic risks lurk

As coronavirus cases in the UK yesterday saw the the biggest jump in cases (almost 3,000) since the middle of May, insurance industry leaders are warning businesses and governments to prepare more rapidly and vigorously for other systemic risks, such as cyber attacks and climate risks.

Munich Re says the response to the coronavirus pandemic has demonstrated just how vulnerable the world is to very large risks. The firm's Torsten Jeworrek says trillions in financial losses ought to be a wake-up call for economies to better equip themselves for other extreme risks.

“The coronavirus pandemic needs to be a lesson to us all: We must take action more rapidly and vigorously to ensure that we are not as unprepared as we were with COVID-19 for risks such as cyber attacks or climate change. It is possible to better safeguard against the financial consequences of such risks for the benefit of humanity. It needs to be clear that systemic risks like pandemics also require systemic countermeasures -- for instance, the creation of state-backed risk pools to make uninsurable risks bearable," he said.

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