Aon revisits underrated exposuresReprints
DENVER A re-examination of findings from Aon P.L.C.'s 2013 “Global Risk Management Survey” that polled captive insurance company directors reveals concerns that risk managers might be underrating significant exposures.
The new “Underrated Threats” report based on the 2013 risk management survey saw Aon questioning executive and nonexecutive directors of captives it manages about some of the findings in last year's survey.
“Some of the key risks, we thought, were grossly underrated, starting with terrorism,'' rated No. 46 among the top 50 risks, said Stephen Cross, Dublin-based chairman of Aon Global Risk Consulting. Responses from captive directors surveyed “supported our finding,” he said.
Heightening concern over terrorism risk is uncertainty over the renewal of the U.S. Terrorism Risk Insurance Program Reauthorization Act, said Aaron Davis, managing director with Aon Risk Solutions' property practice in New York. That uncertainty is hitting the market for liability and workers compensation terrorism coverages particularly hard, Mr. Davis said.
“Another one which struck us as odd was the unethical behavior,” Mr. Cross said. Unethical behavior ranked No. 43 in the 2013 survey, but the effect on a company “can be absolutely devastating and almost take a company out of business,” Mr. Cross said.
“The third one that really struck us was cyber risk,” he said. Ranked No. 18 in the 2013 survey, directors surveyed “thought this was grossly underrated,” Mr. Cross said.