GVNW ready as Fiedler takes the helm

German risk and insurance management association GVNW has risen to the many professional and market challenges presented to members since it was created through the merger of DVS and bfv back in 2016. New president Patrick Fiedler vows to continue the good work as he prepares to host his first Symposium in Munich. The German risk and insurance management association GVNW has grown steadily in recent times by adding members, reaching out to the wider business community and smaller enterprises, further establishing its annual Symposium and building its educational and training offering through a dedicated team based in Bonn. The merger of the two partner associations that represented German insurance buyers – the DVS and the bfv – to create the GVNW under the leadership of Alexander Mahnke, former director of insurance at Siemens, and vice chairman Hans Jörg Schill, was a big move. Then co-CEO Jörg Henne, now head of the in-house broker at leading independent German broker Funk Gruppe, explained the reasoning to Commercial Risk at the time. “As a result of the merger, the new association GVNW speaks with one voice in the market. It is now clear there is one representative body for insurance buyers in Germany, and with that combined strength, we will be better able to achieve our goals – advising members, providing training and networking opportunities and lobbying,” said Mr Henne. The merged GVNW also offered a potentially stronger voice at both industry and political levels, a key area for any industry association. As Mahnke said: “Lobbying is something we have to get a lot better at and getting some of our members to understand it is not something fishy! It is something you need because otherwise you will not be heard. That needs to be done nationally and also internationally. You also need some capabilities to be able to play on the international field. It is also about bringing the association into the next generation.” This renewed vigour was important as a number of big changes were about to play out that needed the GVNW and fellow European associations to play a strong and more public role than in the past. These included: The brutal nature of the ‘sudden’ market hardening in 2017 to 2018, the need to recalibrate the relationship between insurance buyer and carrier and tackle key market efficiency matters that had long been overlooked. The ‘failure’ of the insurance market to respond to the Covid-19 business interruption crisis that raised serious questions about the willingness and ability of the market to act as real partners in the future. The sudden loss of core cover in the rapidly emerging cyber space, supply chain crisis brought about by the war in Ukraine, and, of course, inflation. The ongoing rising impact of natural catastrophe losses linked to climate change, underlying the need for a more joined-up approach to risk prevention, management and transfer and, potentially, public private partnerships (PPPs) for such systemic risks. New president Fiedler therefore takes on the mantle at the GVNW at a time when the association has transformed into a more vibrant and front foot organisation. But the job needs to be continued. He told Commercial Risk Europe that he feels the organisation is ready for the challenge. Value for members “The main objective of the association is to provide value for its members. This is done nicely by our bread-and-butter insurance services such as scrutinising policies, the organisation of seminars and wonderful training and networking events, and last but not least, to give our members a unified strong voice towards insurers and legislation,” he said. “These tasks are delivered by our great team of experts in Bonn and the pro bono work of the delegates and board members. My wish would be to build on and maintain what has been achieved by the outstanding work in the recent years, as well as to establish GVNW as a relevant player for evolving topics such as ESG,” added Fiedler. The risk and insurance profession has certainly benefited from the continuous crises that have plagued the German and European economy, which has put the focus on risk management. It is difficult to generalise in this profession too much because job profiles differ so widely, but it is clear that to maintain that positive momentum, risk and insurance managers need to be smart and grasp the opportunity that lies ahead of them, said Fiedler. “The role of a risk manager remains opaque and depends a lot from company to company, with some attributes depending also on size and culture. The polycrisis of our time should be good for the profile and profession of risk managers, and reporting and legal demands will contribute to a certain sharpening of the role. The more smartly we as risk managers will manage the polycrisis, the more our value will be appreciated,” he said. ESG is rapidly shifting onto the agenda of many risk and insurance managers across Europe but exactly how it is going to pan out from an underwriting perspective remains unclear. German insurance managers express doubts about how insurers are actually using the data they request from customers on their ESG strategies. Fiedler quite rightly pointed out that this is clearly a work in progress but, given the administrative burden that it carries, needs a clearer and more positive approach. “From a GVNW perspective, we gave a press statement on ESG after our meeting in May and we established a new ESG working group. Our members gave us the renewal feedback that while ESG questions are on the rise, the relevance of the responses remains unclear. In some very limited, individual, strange cases, ESG arguments lead to denial of insurance cover, whereas overall the topic has only been perceived as an administrative burden. Is this how we want to make an impact as an industry?” he said. “Our association’s key demand is to move the ESG topics away from negatively loaded image to positive, stimulating discussions. We should more focus on how we can contribute to ensure the required transformation. We’d love, for example, to see a competition of insurers to achieve the highest positive impact by insuring projects with the highest effect on reduction of greenhouse gas emissions,” added Fiedler, offering an interesting idea for insurers to consider. Systemic risks Another critical area for GVNW members and their peers across Europe is how to deal with the seemingly relentless rise of systemic risks such as cyber, health crises and natural catastrophes, a hot topic in Germany since the catastrophic floods of 2021. The German Insurance Association (GDV) and GVNW have been calling for a more joined up, longer-term approach from the risk and insurance sector that could be supported by state backed mechanisms in areas such as flood. Fiedler said that GVNW would continue to play its part to raise awareness of these big questions at both national and EU level, but clearly is not overly optimistic given that even the German terror pool Extremus has a tough time justifying its existence. “This should be discussed much more both on national and EU level. The ‘how’ is dependent pretty much on the specific topics. We note that while, for example, Pool Re includes certain cyber cover, the German equivalent Extremus has to argue again for the extension of the state guarantee,” he noted. The GVNW was highly critical of the performance of the insurance market during the rapid hardening in recent times and poor communication in particular. Fiedler confirmed that, based on the association’s annual survey of members, market conditions in general have improved more recently, but it remains tense for GVNW members in core lines. “The GVNW survey indicates a certain relaxation in D&O, and to a lesser extent in cyber. PD/BI has been dominated by discussions around various impacts of inflation, while other markets were leaning more towards flat developments. Liability exposures in the US, especially social inflation, are a high concern,” he said. Captives have been a useful tool for risk and insurance managers as they struggled to cope with the hardening market. The rise in popularity of captives worldwide has also been seen in Germany. But, as Fiedler pointed out, while hosting a captive at home would be an attractive option for GVNW members there is little sign of appetite from the German authorities to adapt the rules, despite recent changes in France. “GVNW has a captive group, and we note a strong growth of captives, albeit only outside of Germany. We have seen the progress made in France to make the country a more attractive domicile for captives. We are, however, not aware that German politicians or regulators would see the benefit of improving Germany as a venue for captives,” he said. Market efficiency Perhaps more progress can be made, however, in discussion with the insurance market itself. GVNW has taken a strong stance in recent times, publicly pushing insurers to focus on reducing the cost of doing business and improving service levels, contract certainty and, perhaps above all, transparency and communication. Being able to offer senior managers within the corporation more certainty on core matters such as claims is actually often more important than the price of cover, former GVNW chairman Mahnke used to stress. Fiedler said that a more transparent, consistent and proactive approach from the market in key areas such as cyber would be a big step forward and would be welcomed by the GVNW. In cyber, for example, there have been calls for a market-wide wording, or at least set of questions, for risk and insurance managers to make this critical area a simpler and more efficient process. Fiedler agrees. “Yes, that is certainly something worthwhile to be investigated, and we discuss if and how GVNW could play a role in this, also bearing in mind our limited resources,” he said.

GVNW ready as Fiedler takes the helm

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