Operational risk management for banks and insurers shares many similarities, but there are some important distinctions between the two disciplines. Insurers, while better versed in the art of loss modelling and management, bear a lighter regulatory burden when it comes to op risk than their banking counterparts and are generally seen as less well versed in its intricacies.
“When I came into the insurance sector from banking in 2013, I realised how basic the understanding of operational risk was, and to a certain extent it still is. I saw there was a gap in understanding of how pervasive operational risk can be and how it could be managed at insurers. But the gap is not that wide – it can be easily filled with known industry operational…
