The recent chronicle of game-changing risks that companies face operating in today’s volatile world are well-documented, from the Eurozone crisis and the Arab Spring, to natural catastrophes like the Japanese earthquake and Thai floods. Beyond these headline-grabbing events however, new risks are emerging that could blindside business executives, warns global insurance broker Willis Group Holdings in its new website of intellectual capital, WillisWire.
Looking ahead to major risks that may gain more popular consciousness in 2012, WillisWire is out today with a survey of a new set of thorny problems that may be keeping risk managers up at night, from fracking to cyber terrorism, space tourism and uncertainty around renewables caused by national energy policies. The bloggers on WillisWire, which together represent many of the broker’s subject matter experts, have assembled their thoughts about the biggest emerging risks facing their industries and services.
In the special feature – entitled “What New Risks Will Emerge in 2012?” – WillisWire, which has received on average nearly 9,000 page views a month since its launch in September 2011, lays out 18 emerging risks facing industries as diverse as Energy, Banking, Captives and Power & Utilities. The blog also polls readers asking them to identify which of the risks listed they think will have the greatest impact in 2012.
The WillisWire Emerging Risks Round-up includes:
- Energy: “Fracking”
- Environmental: “Fracking”
- Mining: “Contingent Business Interruption”
- Supply Chain Interruption: “Issues at Subtier Suppliers”
- Trade Credit: “Political-Economic Turmoil”
- Financial Institutions: “Bradley Manning 2.0”
- Terrorism: “Cyber Terror”
- Aerospace: “Space Tourism”
- Power & Utilities: “Sodium-Sulfur Batteries”
- Health Care: “Booming Physician Employment”
- Renewable Energy: “Uncertainty Caused by National Energy Policies”
- Captives: “Transfer Pricing”
- Political Risk: “Continued Unrest in Egypt & Libya”
- Analytics: “Over-Reliance on Models”
- D&O: “International Cooperation of Regulators”
- Engineering: “‘Hold Harmless’ Legal Contracts”
- Life Sciences: “'No Fault' Compensation for Clinical Trial Patients”
- Employee Safety: “Obesity Epidemic”
Some of the risks identified by Willis’ subject matter bloggers might not yet be front-andcenter on companies’ radars, like the “perfect storm of cross-border cooperation between regulators” brewing outside boardrooms globally. Other exposures, like the risks associated with hydraulic fracking for natural gas, have been growing in significance lately, with several lawsuits (but no big claims as of yet) making insurance hard to find.
The WillisWire list also includes some new twists to well-known risks like Supply Chain disruption, which is becoming increasingly prevalent in today’s globalized market, with industries like Mining and Energy bearing the brunt. Willis’ Trade Credit blogger Andrew Van Den Born, an Executive Director of the broker’s Financial Solutions division, warns, for example, that Iran's threat to close the Straits of Hormuz, “one of the most strategically important choke points for traded seaborne oil”, could trigger a supply chain meltdown in the oil and gas industry.
Looking into the not-so-distant future, WillisWire’s Financial Services Practice Leader and blogger, Richard Magrann-Wells predicts that “Bradley Manning 2.0 -a “bright programmer with an Ivy League education and an access card working at a technology, bank or credit card company” is a new threat that financial institutions should work to protect themselves against.
Over 27 bloggers from across Willis Group regularly post their thoughts on WillisWire about the insurance implications of significant industry-specific events, giving readers real-time information and insight into all the risks facing their business. This year, WillisWire will be running a series of special features, topical video interviews and commentary on breaking news.