GILC’s View: Megatrends demand more collaboration

Like 2021, 2022 has been a time of great change for our members and clients around the world. Global Insurance Law Connect recently published the fourth edition of our Risk Radar report, examining trends in members’ insurance markets. What is most striking from this edition is the rise of a group of megatrends that span every jurisdiction and by necessity, require a wholesale global response. Our members have been focused on cyber, climate risk, and the pandemic’s long tail – with an emphasis on the stability of the D&O market.

The industry has experienced an accelerated push into digitalisation, driven by remote working practices and organisations incorporating digital innovations and multi-channel strategies into mainstream processes and products. Regulators are working hard to keep up with the pace of change and develop frameworks and standards to ensure companies behave transparently and consumers are protected. Our members expect this dialogue to continue in 2022 and even intensify. In parallel with digitalisation comes the persistent rise of cyber risks and vulnerabilities and the industry will spend much of this year assessing how to price, mitigate and manage these risks.

Last year’s COP26 Conference elevated the climate crisis well up insurers’ agendas, the outcomes of which will remain in the spotlight throughout 2022. The insurance industry has been under scrutiny for its practices, in part due to a focus on some of its less climate-friendly underwriting activities. However, the industry is going to need to be at the cutting-edge of solutions; by the very nature of what insurers do, the industry has a real chance to be a leader in climate resilience.

In addition, as concerns about greenwashing grow, insurers will have to work out how they can effectively assess the carbon footprints of their insureds and supply chains, with a view to helping them decarbonise.

While the intensity of the Covid pandemic has passed, directors and officers remain vulnerable to its effects. As governments around the world remove the economic protections put in place, some companies have been struggling and their directors are coming under pressure around the decisions made under the constraints of the pandemic. In some jurisdictions, the number of shareholders’ proceedings are rising, and should an economic downturn eventuate this may become a longer-term trend.

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Modelling and measuring transition and physical risks
CIR's editor, Deborah Ritchie speaks with Giorgio Baldasarri, global head of the Analytical Innovation & Development Group at S&P Global Market Intelligence; and James McMahon, CEO of The Climate Service, a S&P Global company. April 2023

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The connected nature of the transport and logistics industries makes them an attractive target for hackers, with potentially disruptive and costly consequences. Between June 2020 and June 2021, the transportation industry saw an 186% increase in weekly ransomware attacks. At the same time, regulations and cyber security standards are lacking – creating weak postures across the board. This podcast explores the key risks. Published April 2022.