Climate change, cyber and market/economic/financial risk top the list of emerging risks with which enterprise risk managers cope, according to a report released Monday by ratings agency A.M. Best & Co.
Infectious diseases/contagion/pandemics placed seventh on Best’s list of the top 10 emerging risks, even against the backdrop of the coronavirus outbreak.
The report is based on Best’s examination of the impact of more than 60 potential risks on U.S. insurers’ claims frequency and severity.
The threats and challenges posed by such risks requires that “emerging risk management” be “an essential part of the ERM (enterprise risk management) toolkit,” Best said in its report.
“Insurers need to continually scan the ecosystem for risks, quantify the impact of emerging risks, and be proactive in designing mitigation plans in the event that these risks manifest themselves,” the report said.
Climate change, and the added exposures resulting from increased frequency of hurricanes, drought and wildfires, is hitting insurers, Best said, providing data that showed the number of natural catastrophes has risen steadily since 1970.
“With the…
