Challenging times but Sedgwick looking to help risk managers
There are clearly a number of major issues currently impacting corporates, so Tony Dowding talked with Sedgwick at the Ferma Forum 2022 about the current risk landscape, what they see as the major concerns for risk managers and how the company can help.
Inflation is on everyone’s mind at the moment, and Stewart Steel, chief executive officer, Europe, Middle East and Africa at Sedgwick, agreed that inflation is a big issue not just in property but also in the motor industry as well. “It’s been enhanced not just by normal economic inflation but also supply chain issues, which are introducing more scarcity and choice issues as well – for example, in getting steel and timber, and delays which impact on reinstatement periods, expand business interruption periods and so on. Inflation also of course hits employment as well, so wage inflation increases the cost of providing services,” he said.
He also noted the rise of social inflation: “The challenge for social inflation with liability or casualty is that it can vary from territory to territory, because there are so many different factors such as different legal structures or cultural approaches to whether people claim or don’t claim.”
His colleague James Norman, business development director, Sedgwick International, said: “If we recognise that because the risk landscape is ever more global, complex, interconnected and volatile, then we can take a positive mindset to drive greater collaboration, partnerships and innovation – resetting how we manage risk. Working together with the global lens will give us strong capabilities to deliver change and enable us to transition successfully.”
He added: “Sedgwick can support risk managers, brokers and insurers in reducing the total cost of risk and having greater efficiencies in managing global and/or cross-border claims programmes. Outsourcing claims is a difficult decision, as is deciding at which level to do it. It can be easy to stick to the status quo because of the uncertainty. However, it is a good time to review how things are working and what could be done differently to add greater value and insights.”
Steel says two of the big issues that keep risk managers and their board awake at night are the one-off major event that hits the boardroom agenda, and something that impacts the reputation of the business – that could be a product recall, it could be a cyber event – anything that causes the board and shareholders to be very worried about the future of the company, he said.
“We have a product that is exclusively focused on that and we can align it to the corporate nominations that we have already have across the world, as an additional solution. Typically, you’d have to contract with at least two or three separate organisations to be able to do that. In Europe, it has been one of our fastest-growing new products. We will work with the corporate risk management team, their legal team and we can support them with PR and communication around clients and markets, so we can act as a coordination point for all of that activity,” said Steel.
He added: “The initiation of such an event is not the ideal time to start to learn about the many logistical, communications, reputational and compliance challenges that emerge in very short order. Our brand protection offering, which includes remediation and customer retention solutions, helps mitigate those risks by aligning our service with our clients well in advance of an event.”
