The launch of the Risk Frontiers Asia 2017 survey

In 2016 we launched the inaugural Risk Frontiers Asia Survey. During the course of the year we interviewed more than 50 risk managers across the region and in a variety of industry sectors.

We asked them for their views on risk management and insurance – from the top three risks that keep them awake at night to the one insurance policy they would wish for were they to be in charge of an insurance company for a day.

We also canvassed their opinions on some of the classic issues for risk and insurance managers in the region – the use of global programmes, the amalgamation of general insurance and employee benefits and the development of the captives sector.

The results, which we published in November, with the help of our lead partners Generali and Parima, and presented at the Parima conference in Singapore, were illuminating.

Notwithstanding some regional disparity, notably between the more mature markets of Singapore and Hong Kong and the less developed domiciles of Vietnam or Myanmar, the use of global programmes and captives was broadly in line with the results from our surveys in Europe and Africa.

Risk management profession

This supports the idea that the risk and insurance management profession is rapidly developing and becoming as sophisticated as the more recognised markets in the US and Europe. For example, over 60% of risk managers employ a global programme or else plan to do so in the near future.

Similarly, the majority of managers use or plan to use a captive. And, in the course of conducting this year’s survey, it will be interesting to see whether these figures increase. So far this year we have seen the interest in captives increase in certain domiciles with ambitions to establish themselves as captive centres for the region and for both domestic corporates and multinationals expanding into Asia.

The Labuan Financial Services Centre in Malaysia has outlined its plans to grow its captives sector. Hong Kong has done similar and China continues to forge alliances with both insurance advisory firms like AM Best and offshore centres like Guernsey in order to further its own captives sector.

This year we want to use the survey once more as a barometer for the risk management profession by not only examining familiar issues like the level of boardroom access for risk managers but also exploring the development of more sophisticated concepts like enterprise risk management.

How many managers have implemented an ERM programme? What does it look like and is there a standard definition for what has, in the past, been seen as a somewhat nebulous area of the profession? And, for those that do have an ERM programme in place, what benefits has it created?

Cyber and technology

Last year’s survey also asked managers to identify their top risks and while natural catastrophes were an understandable concern in a region where the gap between loss events and insurance adoption is worryingly large, the survey also showed that Asian risk managers are also concerned about the growing exposure posed by cyber and technology risks.

Consequently this year’s survey will feature a special focus on cyber risk and insurance. We will ask risk managers who is responsible for cyber risk and how insurers and brokers help risk managers prevent cyber risk. What proportion of their cyber exposure is covered by insurance and where are the coverage gaps that they would like to see filled? Has there been any noticeable improvement in terms of cyber insurance either in capacity or pricing?

Or is cyber simply too big a risk to be left to insurers? Is it time that governments and other state bodies took a greater role in covering cyber exposure by establishing cyber pools in the same way we have seen occur for natural catastrophes and terrorism?

But we also recognise while technology has created new exposures for corporates, it is also instrumental in helping risk managers. We have seen the use of machine learning, artificial intelligence, robotics and big data analysis make great inroads in other industries. Can the same technology be used to help identify, monitor and ultimately manage risks?

Do risk managers already employ these technologies or is it an area that remains aspirational rather than tangible? Do the products exist or is this another area that is visible only on the wish lists of our readers?

For example can wearable technology, a common feature in the Insurtech world and in the development of personal lines like health insurance, also be applied to the corporate risk world, such as in the example of warehouse workers and workplace accidents, or in the slips and falls monitoring for hotels and shopping centres looking to reduce their professional liability?

The Asia region has a well-deserved reputation for technology advancement and adoption and we want to see if this is one area where risk managers and their companies can supersede their peers in other regions, rather than simply playing catch-up.

Unencumbered by the legacy of age-old infrastructure and the inefficiencies of the insurance industry, we want to see if Asia has a genuine chance to forge new ground in the relationship between risk managers, their insurers and their intermediaries.

Are features like the annual renewal now redundant in an age of on-demand insurance? Will we ever get an insurance policy delivered upon its inception rather than six months down the line and after a claim has been made? Or will new technology render traditional insurance increasingly irrelevant?

One of our participants in last year’s survey, when questioned about the level of innovation in insurance, asked “where is our Steve Jobs?”  Maybe that innovator will come from among the risk managers themselves and not their service providers.

Roundtables and interviews

So how will this year’s survey be conducted? The key to any research is the quality of the data. Therefore we will be looking to engage directly with as many of you as possible through face to face interviews.

We will also be conducting a series of roundtables in different local markets as we travel across the region, beginning here in Manila during the Parima conference. Last year our roundtables in Malaysia, Singapore and Hong Kong proved enormously beneficial both in terms of the survey itself and for our own understanding of risk management in the region and, more importantly, to understand the needs, demand and concerns of you, our readers.

We are also happy to announce Generali and Parima as our lead partners once again.

The survey questions will also be available online for readers to fill in. Anyone wishing to take part in ether the survey or a roundtable should contact [email protected] or visit www.commercialriskonline.com for more details

With the Parima membership passing the 1,000 mark earlier this year, there are many of you out there and we hope you will help in making this year’s Risk Frontiers Survey bigger and better than ever before.