Each year, the Risk Management Society (RIMS) hosts one of the largest industry events. The annual conference and tradeshow brings together thousands of insurance and risk experts, and for the 11th year in a row, the Spring team was among them. We were happy to take a break from Boston’s not-so-springy weather and head to San Antonio for RIMS 2018.
Over the course of the 3-4 days, I was able to a) meet and greet insurance colleagues, both new and familiar, b) party like a true Texan (in case you thought Risk Managers would make for a dull crowd – you may want to rethink this notion), and c) get a gauge on the most popular industry trends and concerns.
For this writeup, I’m focusing on point C, because between various networking and social events, there was a lot to learn at the RIMS annual conference, and I’d love to share some takeaways. Here are the most buzz-worthy topics, in my opinion.
- Cyber & Tech
As it has with conferences and news headlines over the past 5-10 years, technology took center stage at RIMS. However, I’m using “technology” as an umbrella term to represent a range of digitally-centric, Internet of Things (IoT) subjects, such as:
During Berkshire Hathaway, Inc.’s annual shareholders meeting, Warren Buffett Chairman, President and CEO said, “Insurance is very early in the game in determining how to cover the risk of data breaches, ransomware and other hacking perils”. He then went on to say that the risk itself is a “very material risk” that didn’t exist 15 years ago one that will get worse. The world of cyber threats and attacks continues to keep risk professionals up at night. From my actuarial perspective, the probability and severity of cyber loss events are becoming better understood, although there still is tremendous uncertainty due to the rapidly changing nature of the risk. The following Cyber sessions were presented at RIMS:
- In “Are You Prepared for a Cyber Extortion Event?”, audiences were walked through different ransomware threats and a checklist for getting through such an attack.
- Jason Trahan went into further detail in explaining the “Anatomy of a Cyber Event Claim”, which provided a preparation process for cyber claims as well as an extensive list of possible claims expenses.
- A representative from Willis Towers Watson highlighted the importance of corporate culture when it comes to combating cyber risk.
- A woman from The Washington Post Risk Management team led a discussion on the different insurance policies that intersect when it comes to cyber risk, and how to manage these overlaps.
- Jeffrey Sharer of EY revealed some startling statistics such as: “89% say their cybersecurity function does not fully meet their organization’s needs”.
- Joon Sung and Kevin Kalinich stressed the importance of recognizing and addressing your third party/vendor cyber exposures, nothing that cyber resilience is not just an internal matter.
- During “Pay Up or Else: Ransomware Risks”, John Coletti and Anna Ziegler explained the latest trends and scams in the ransomware sphere and offered advice on how to be both proactive and reactive.
- One session focused on communicating a cyber attack to your C-suite, board of directors, and/or other superiors. Ten best practices were shared, such as: “Have a customer notification plan and procedures in place.”
b) Autonomous Vehicles
In March, a self-driving Uber car killed a pedestrian in Arizona, and an autonomous Tesla vehicle caused another death in California. These two incidents are just a couple of many news headlines involving self-driving cars, which certainly pose a variety of risks. As such, they were discussed on several occasions at this year’s conference.
- In a session entitled, “Driving Insurance Forward”, Katherine J. Henry provided an overview of how autonomous vehicles are covered, the consequences they can bring and ways to confront this emerging risk.
- Representatives from Liberty Mutual and Ford Motor Company teamed up to explain the different industries that will be affected by the rise in self-driving cars, from oil to advertising companies. Their presentation spoke to the broader trend of disruption in the automotive industry, pointing out 4 facets to consider: autonomous driving, electrification, connectivity, shared mobility/economy.
c) Social Media & Mobile Apps
Considering the recent Facebook privacy scandal, it was important to look at social media and mobile issues from the perspective of risk management and mitigation.
- Gregory Bangs of XL Catlin spoke to the topic of “Social Engineering”, which can incorporate a range of scams such as vendor impersonation and malware. He explained what these fraudulent activities can look like and their implications for insurance coverage and employee preparedness.
- In “Swipe Right on Insurance”, Cort T. Malone and Stephanie Hyde discussed the risks and insurance options related to social media platforms and mobile apps, as used by employees. They covered things like harassment, privacy, reputation, business torts, intellectual property and the regulatory environment.
- Thomas Ryan highlighted the opportunity a “wearable” device poses from a workers’ compensation coverage standpoint and guided the audience on selecting a wearable vendor for corporate use.
- Two experts from Modjoul Inc. and Cotton Holdings Inc. explained wearables in detail – why use them, how to use them, how they work with insurance carriers, etc. Through a case study, they also endorsed wearables as an option to keep employees safe and productive.
e) Drones & Other Tech Matters
- Chris Proudlove of Global Aerospace and Vincent Monastersky of Fox Entertainment Group presented the challenges and opportunities associated with the widespread growth of drone use, both commercially and personally. It turns out, over 75% of drone-related claims were caused by operator error. Further, they outlined coverage types and options.
- A session on emerging technologies, including smart sensors, wearables, drones and artificial intelligence gave audiences a broad but detailed landscape of how all of this connectivity affects the “risk ecosystem”, and tips on how to prepare for the future.
- Another discussion, led by Tim Yeates, covered the “Fourth Industrial Revolution” and the benefits and risks of the level of information being shared today. Thought-provoking questions like, “Who do we trust – human intelligence or artificial intelligence?” were posed.
- Natural Disasters
In 2017, the U.S. was hit hard with Hurricanes Maria, Harvey and Irma as well as wildfires in California. Outside the U.S., the Caribbean was crushed with those same hurricanes, a devastating earthquake hit Mexico, extreme flooding impacted areas like Bangladesh and Sierra Leone, and areas of China suffered from landslides and typhoons. Unfortunately, this is not an exhaustive list.
- Stephen Moss explained the anatomy of a catastrophe risk model and pointed out the large protection gap, noting that about 50% of the losses incurred from 2017’s most impactful natural disasters were uninsured.
- An attorney from McCarter & English, LLP focused on business interruption losses resulting from catastrophic loss, discussing pitfalls that could cause your claims to be undermined as well as best practices for getting coverage.
- Robert Nusslein of Swiss Re explained parametric natural catastrophe insurance for hurricanes and earthquakes, how it differs from traditional insurance and how it can help fill in gaps.
- In “The Future of Climate Risk Management”, audiences learned about their company’s climate risks – the size, scale, complexity and reach. Then, the speaker introduced solutions and tools for such risks.
- James Pierce spoke on “Mother Nature’s Onslaught” and speculated on whether a new norm is needed in combatting natural disasters.
- One session, “The Sky Fell”, went into further detail on catastrophic claims: common claim mistakes, communication issues between layers of insurance, crisis management tactics, TPA management and more.
- The CEO and Founder of Orbital Insight, a geospatial analytics company, outlined how technologies like satellite and drone imagery as well as AI and cloud computing can provide insight into catastrophic risk assessments. He even showed audiences imagery showing flood detection for Hurricane Harvey, as one of several illustrations.
Compliance is always a key concern in this industry. What changes year to year are the specific areas of compliance focus, some of which are below.
- Lisa Kerr and Bruce Wineman led a session on multinational program compliance – highlighting regulations, tax law, offshoring and variability as things to look out for.
- A different presentation focused on Medicare and Medicaid compliance, going over the boatload of associated acronyms, lien compliance, reporting and what to look for in a partner.
- In “Risk Management, Compliance and Preparedness”, attendees received an overview of SRM and ERM, examples of strategic risk, automation advice and more.
If you were able to make it to the RIMS conference this year, I hope this helps you retain they event’s key takeaways. If you couldn’t make it to San Antonio, well, now it’s almost as if you were there!
Please feel free to reach out with any questions, actuarial or otherwise. In the meantime, put RIMS 2019 on your calendar – April 28th – May 1st – in Boston (our backyard). We’re already excited for it!