Collaboration key to risk challenges, says Sedgwick
Collaboration and connection are key to handling the risk challenges in 2024, according to Sedgwick. The claims management and loss-adjusting firm has published Connect 2024, which highlights major industry trends and issues that employers, carriers, brokers and risk management and human resources professionals should watch throughout the coming year.
“As we support our clients in navigating the ever-present and evolving challenges in store for 2024, our analysis pinpoints opportunities for collaboration across a variety of industries,” said Scott Rogers, Sedgwick’s chief client officer. “Our vision is to overcome obstacles through a forward-thinking approach based in connectedness and unlocking new potential.”
On workforce issues, Sedgwick says: “The dynamic work environment is being shaped by labour and economic challenges, along with shifting workplace priorities as people expect elevated experiences in the office and in everyday interactions. Key conversations will revolve around the workforce, consumer experience and health and well-being, most notably including career development, enhanced benefits for overall well-being, incentives to make the workplace more appealing, cost management, and outsourcing versus insourcing considerations.”
Sedgwick says it expects more movement toward transactional, embedded benefits and coverages for employees and consumers, including options like travel and medical coverage and voluntary benefits, as many try to streamline purchasing and protection. It also says hiring and retaining talent will again be a top priority for the year, and diversity, equity and inclusion efforts remain important to job seekers, which means that having a strong and inclusive employer brand is critical.
On the liability side, Sedgwick says: “Organisations are seeking new ways to manage costs and expectations – as well as build relationships and trust – in a market where expensive litigation persists, union influence is growing, and public opinion can shift in an instant. Nuclear verdicts show no sign of slowing down, especially in product liability, auto liability and medical liability cases; pressure continues to mount for organisations and insurers as third-party litigation financing increases the duration and complexity of litigated matters.”
On the property side, Sedgwick notes that insurers and policyholders have been faced with increasing claims volumes stemming from natural disasters, civil unrest and geopolitical developments. Recent disasters like the Maui wildfires in Hawaii and devastating floods across Europe have underscored the urgent need for climate resiliency, including comprehensive disaster preparation, recovery strategies and claims processes.
“Insured organisations are facing increased premiums, reduced capacity and restricted terms and conditions; in tough regions of the US like Florida and California, for example, it is harder for consumers to get property insurance coverage at all. Risk managers must consider alternatives such as increased retentions, captives and mitigation measures,” says the firm. “Captives can be used for taking on more risk, building up cash, unlocking options like reinsurance and quota share, considering deductible buydown, allocating funds between divisions, and generally providing flexibility amid tough market conditions.”
Sedgwick concludes: “2024 is the year to move beyond the routine: to interact in new ways and seek added value within partnerships. It’s a year to engage, whether through in-person, intentional gatherings, strategy sessions and trainings, or virtual collectives. It’s a time to break down silos and hierarchies, remove roadblocks, encourage collaboration, and connect for new ideas.”
