in a newly published study by the geneva association*, it lists out the top concerns facing the insurance industry in 2012 which includes:
a. current global financial instability
b. concerns over governmental management of natural catastrophic risk and
c. the demographics of dealing with ageing socities.
the secretary general and managing director of geneva association, mr patrick m. liedtke on the current financial crisis said that:
"no other topic has worried nation states around the world more persistently in 2011 than the question of global financial stability."
on claims for natural catastrophes that struck in 2011, mr liedtke said that it is:
"by far the most expensive year on record for natural catastrophe insurance with estimated claims reaching some US$380 billion. even given some variation from current loss estimates, 2011 will turn out to be nearly two-thirds more expensive than 2005, the next most expensive year (US$220 billion). but the issue here is not only one of claims and payouts - it is one of human tragedies and loss."
on the concern regarding the demographics of dealing with ageing socities, and while it is a positive that people are living longer, this poses a dilemma for the governments of the countries they live in, which is in turn worsened by the financial crisis.
on this, mr liedtke said:
"in light of the current state of many sovereigns and their finances, they do so facing greater uncertainty than other retirees in several decades. doubts over heavily indebted states' ability to provide social security have increased. volatile returns from many private sector investment products have eroded confidence in pension provisions and retirement planning. yet, individuals continue to seek stable streams of income that will afford them a decent standard of living beyond their working years."
In conclusion Liedtke urged both society and politicians to “grasp the nettle and face up to the inevitable implications of these long standing challenges. Given the role of the insurance industry and its ability to provide long-term stability, it has the potential to be a significant part of the solution to this problem. This is a great opportunity for all involved. In 2012, insurers should raise the profile of this issue and be the leading private sector counterparty to help governments develop a credible and sustainable way forward.”
*from wikipedia on the geneva association:
The Geneva Association is the leading international insurance “think tank” for strategically important insurance and risk management issues.
The Geneva Association identifies fundamental trends and strategic issues where insurance plays a substantial role or which influence the insurance sector. Through the development of research programmes, regular publications and the organisation of international meetings, The Geneva Association serves as a catalyst for progress in the understanding of risk and insurance matters and acts as an information creator and disseminator. It is the leading voice of the largest insurance groups worldwide in the dialogue with international institutions. In parallel, it advances—in economic and cultural terms—the development and application of risk management and the understanding of uncertainty in the modern economy.
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