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Will the insurance industry change its attitude to operational risks due to the recent crisis

If we have learnt anything during the Coronavirus pandemic it is that the external environment can change overnight without warning with a material impact on our businesses. As we begin to look forward to life after lockdown we need to ensure our businesses are resilient to future external threats. The human race has come a long way, we’ve advanced many technologies, eradicated disease and built defences to many catastrophes. So why are people and corporations still vulnerable to external threats?

Businesses focus on managing their internal risks, as mitigating environmental risk is challenging. Insurance companies are expert at modelling the impact of environmental risks from a financial perspective, but it is difficult to ‘experiment’ at scale with the operational impacts across multiple possible scenarios of environmental risk and therefore plans necessarily need to be less specific. To achieve this, broad operational resilience, including smart technology, is needed. Monitoring risk within your business must include the supply chain. The impacts of supply chain problems and the emergence of reliance on new ones (online collaboration tools now paramount in our working lives) has become obvious. But due to resource and budget constraints, businesses tend to put managing the supply chain as a lower priority. This is potentially short-sighted and can actually; end up costing more in the long run, have further significant consequences and cause your business to collapse. Low-cost technology solutions can however provide the answer, by offering the right level of risk mitigation at an affordable price. The business landscape is constantly changing. Being reactive and only responding to problems once they have manifested is not an option. An organisation that was performing well at the last financial statement or audit may quickly become unstable. This may not be due to events as wide-reaching as Covid-19 but more localised and hidden unless monitoring is continuous and wide-ranging. To minimise risks to our business, we need to be alert and ready to mitigate threats to our business before they occur by proactively monitoring emerging risks, but, with limited resource it is challenging to see risks before they happen. This is a space where technology can provide good answers; analysing huge datasets and providing alters on recognising patterns that are predictive of potential risks and issues. The best defence is to understand these existing and emerging vulnerabilities and ensure there is resilience built into your plan. Resilience needs to look beyond the obvious. This might feel like an added burden or a change to your business process but with technology advancements and Albany’s solution Conect, our software can support your business to be operationally resilient in this way. Conect is a technology solution that automates managing the supply chain. Conect provides continuous monitoring, is proactive and configurable to your business needs. Its real time central repository and data hubs make regulatory compliance, proactive managing and auditing of your supply chain, simple, effective and stress free. Conect is a smart way of building resilience into your business plan. To learn more about how Conect can help your business to be more resilient contact us for an informal chat or to arrange a free demo.

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