Sirm board confident members can avert risk management overload in polycrisis

Leading Swiss risk and insurance managers agree that their profession is under strain in the polycrisis and that overload is a risk, but seem confident that most can overcome this problem by prioritising workload, collaborating with colleagues, improving communication, leaning on external expertise and making their newly found prominence count.

“I do see risk management overload as a big risk,” Stefan Günther, head of insurance at Coop Genossenschaft and new board member at Swiss risk and insurance management association Sirm, told Commercial Risk Europe. He said the polycrisis is putting “even more strain” on “already limited resources”, which is increasing stress levels and “endangering clear implementation of risk strategies”.

Fellow new Sirm board member Pierre-Louis Chabert, director of insurance and risk management at Alcon, believes risk management overload is a risk that varies “significantly” depending on an organisation’s structure and the scope of a risk manager’s responsibilities. He said much depends on whether individuals are involved in enterprise risk management, insurance or both.

His peer Jurrit Herber, Sirm board member and head of risk at Eviosys, said the polycrisis is making life more complicated for risk managers and risks harder to manage, but he doesn’t fear overload as long as the profession can adapt.

“Yes, there are so many events creating the polycrisis where the sum of all the risks exceeds the individual risk. But is it too much to manage? Of course not. Is it harder to manage? Clearly yes,” he said.

Rocco Bozzelli, head of global insurance at MSC Cruises and another new Sirm board member, believes that a plethora of now tangible risks, from the pandemic to nat cat events, have created more workload for risk managers and increased the focus on risk management. While this is no doubt making life more complicated, Bozzelli thinks the crisis means risk management is now generally seen as a strategic activity and this focus can help avoid overload.

“The good news for me is there is a new focus on risk and insurance management,” he said. “Now that there is more knowledge within companies about the risk and insurance function, it should be easier to get buy in from the top to help manage these tangible risks.”

Herber agrees that risk professionals can take advantage of their rising prominence since the start of the polycrisis and Covid-19 to help ensure their function is heard and delivers at the strategic level. But he cautioned against overplaying your hand.

“There is momentum to drive risk management, but if you bombard management with too much information, it will be overkill, in my opinion. Yes, you have a spot at the top table now and people are much happier to listen and discuss topics, but that doesn’t mean you should overdo it. You need to gradually progress and point out the importance of your risk management. And then going forward, board members will accept this is a crucial function within the organisation that you should weave within the everyday working structure of the company,” he said.

The Sirm board members were all clear that there are a range of tactics to help deliver in these testing times.

Günther said some of the key elements are clear risk prioritisation and better communication, alongside more delegation within the company.

Chabert said risk managers should focus on several key strategies to avoid overload.

The first is enhanced communication and collaboration. “Internally, risk managers should engage closely with other business functions. Effective communication ensures that the value of risk management is understood and integrated into the early stages of business decision-making. By anticipating risks and embedding risk management into the organisational fabric, we can mitigate overload,” he said.

The second key strategy, as far as Chabert is concerned, is leveraging external support. He advised risks managers to utilise their relationships with brokers and insurers to outsource routine insurance programme management tasks, alongside developing new tools that drive efficiency and deliver more predictable risk management outcomes.

“Initiatives like AI-supported supply chain analysis or financial risk quantification should be promoted and jointly funded, benefiting both risk carriers and policyholders. Historically, the insurance industry has lagged in technology adoption, but advancements in AI offer a transformative opportunity to bridge this gap and significantly improve risk management practices,” he said.

Chabert also believes risk managers should focus on improving administrative efficiency to help avoid overload. “The polycrisis and evolving legislative landscape have increased the administrative burden on companies, particularly with issues like cyber risks, sanctions and PFAS disclosures. Risk managers and other departments must often respond to similar inquiries, and internal AI initiatives could help streamline these responses, reducing the risk of overload,” he said.

And, finally, Chabert advocates increasing agility and efficiency. “Companies must be agile and efficient to manage overload risk, not just in risk management but across all departments facing similar challenges. The ability to adapt quickly and implement efficient processes will be crucial,” he said.

For his part, Rocco believes AI and data analysis can help take the best possible decision. And he too would like to see brokers and insurers offer more risk consultancy services. “Brokers can help us conduct analysis if the risk function needs help, particularly in smaller organisations,” said Rocco.

Herber urged his peers to come together, not least through national and regional associations, to help each other meet the workload and share best practice. He too stressed that risk engineering services from insurers are more important than ever.

“We need to lean on our fellow risk managers for help and advice, and to share solutions. That is why risk management associations are now vital, so we can come together to organise workshops and training sessions to share our knowledge. Instead of each of us inventing our own wheel, we should share the knowledge. Everyone has a piece of the puzzle and together we can complete the jigsaw,” he said.

“So while we can’t manage the macro risks, we can partially mitigate the risk on our company. We can come together so we are confident that as far as possible we have been able to manage a specific risk within the polycrisis and the impact on our company to a more tolerable level,” added Herber.

He said this will require more flexibility from risk managers and the range of experts that help them do their job – particularly insurers. “Insurance companies need to step up more, especially when it comes to risk engineering. These risk engineering services have always been vital but they are now more vital than ever,” he said.