(Re)insurance industry “hasn’t worked out” what cyber risk means: WTW’s Garrard
While cyber presents an enormous growth opportunity for the (re)insurance industry, the market has not yet fully worked out the role it can play in addressing such perils, according to WTW’s global head of risk and broking Adam Garrard.
Speaking to The Insurer TV, Garrard said there is a lot of progress to be made on understanding the risks associated with cyber.
When asked where WTW sees opportunities for growth, Garrard said although cyber is a line of business where it will look to grow, he is “not sure the industry has quite worked out what it [cyber] means yet, and what it’s going to provide and where it’s going to position itself”.
“But nonetheless, cyber is a huge and emerging risk and obviously that market is growing exponentially as we speak,” Garrard noted.
In addition, Garrard said he believes the industry has a role to play in climate change, pointing out the sector’s expertise around catastrophe risk, adverse weather risk, transitional risk and liability risk.
One of the challenges for the industry, and one of the reasons it has not yet fully understood the role it has to play around climate, has arisen because there is a detachment between companies’ risk departments and ESG departments, Garrard noted, adding he believes climate is a risk issue.
Early stages of flexible working
Remaining on the topic of systemic perils, Garrard pointed out that the Covid-19 pandemic had underlined the need for the industry to provide solutions for such risks.
Following on from the pandemic shutdowns, he said it was also important for the industry to adapt and respond to new flexible ways of working.
“I’m not sure that we have, as an industry and indeed a society, felt deeply about the risks associated with that. And those risks are quite complex and quite far reaching,” he said.
As an example, Garrard noted the difficulties of defining how society could navigate its way around risks such as culture, productivity or training and development, adding it is up to the (re)insurance industry to find products to mitigate such risks.
In addition, new and emerging risks – many of which are intangible – could arise from less clear directions on flexible working conditions compared with in-office, fixed-hours work, or from non-compliance with labour and tax laws.
“When does employer’s liability kick in if you’re working at home? Is it when you’re going down to get your breakfast or is it when you’re going down to your office? There’s a lot of risks that we haven’t factored into that equation,” Garrard noted.
To view the full interview with Garrard, where he discusses the impact of the Russia-Ukraine conflict, the unconsummated Aon-WTW transaction and several other topics, click here: