FM Global "steal" the initiative whilst others dither – Insurance Insight
Wednesday, 30 November, 2011 4 Comments
It is very rare to read about meaningful innovation, from an insurer, that is about anticipating and responding to policyholder needs but that is exactly what FM Global appear to have done. Well done to FMG and I sincerely hope that they reap the reward of competitive advantage, that such a rare development merits. BUT I do have my concerns.
Whilst it is not for me to question if they know what they are doing…as far as offering protection and reassurance to their customers they undoubtedly do…I wonder about the timing. Perhaps they have overcome concerns about the current turbulence in the global economy OR have decided to pursue a bold strategy right out of the Warren Buffett handbook: “be greedy when others are fearful and fearful when others are greedy”, so plan to be perfectly placed to capitalise upon the lessons that must be learnt following another credit crunch – i.e. the realisation that price is only one metric and that risk management does not = resilience management!
Despite the great uncertainty that “hangs over” the global economy it is still a very competitive marketplace. Current insurers and brokers will fight hard to repel unwanted approaches so I can only hope that the steady stream of useful information that FMG produce reach their intended audience within major insurance brokers and among Corporate decision-makers…then pray that they receive support based upon the quality of the protection!
Irrespective of the precise reason(s) I wonder at the wisdom of such a bold initiative without tools that would enable all parties [insurer – broker – customer] to shorten the risk assessment process – supplementing it with an objective, quantitative, analysis of the the complexity and robustness of the “Corporate structure”. This is information that, without Ontonix Quantitative Complexity Management tools, remains hidden in the data. Such analyses extend the risk horizon beyond the limits of conventional risk management and into uncertainty, gaining and sharing knowledge about the complex nature of customer inter-connections as part of the risk profile and that of its ecosystem, both, up and downstream in “real-time”.
As uncertainty becomes the norm, better contract certainty and having a comprehensive insurance policy that keeps pace with the evolution of risk have become key for risk managers today. This has created the need for insurers who serve their policy holders’ best interests to ensure that clients are provided with the broadest coverage in the marketplace and with the highest level of contract certainty.
Good risk managers rightly direct a lot of effort to minimising the risk of a loss happening, but when a major event occurs they want the comfort of knowing they are insured with a carrier who regularly looks into improving the language of their policy in order to reflect a focus on transparency, clarity and a move towards enhancing cover to include key areas of growing importance. At the same time, however, in these volatile times, many insurers may actually be looking for ways to restrict coverage and reduce capacity to stave off the fallout from the next major disaster.
- “Both insurers and insurance intermediaries need to fundamentally rethink how risk is assessed” (fitforrandomness.wordpress.com)
- Reveal Your Hidden Profits: Looking at complexity in business? (via Get “fit for randomness” [with Ontonix UK]) (fitforrandomness.wordpress.com)
- Ontonix and CUBEXX Offer Complexity Management in SAP’s Business Warehouse (fitforrandomness.wordpress.com)
- Insurance Brokers: Read the signs and act…or risk being left behind! ” Get “fit for randomness” [with Ontonix UK] (fitforrandomness.wordpress.com)
- Governance – Risk – Compliance: accept responsibility to reap the rewards! (fitforrandomness.wordpress.com)
- Eurozone Crisis Causing Companies To Plan For The Unthinkable (huffingtonpost.com)
- Smith & Associates: Thailand Floods Underline Global Supply-Chain Threats (prweb.com)
- Probing Uncertainty by Digging Deep Within in the Supply Chain for Answers (spendmatters.com)