The COVID-19 pandemic has made dramatic changes to the way we live and work, and many of those changes are likely to remain in place once the pandemic has passed. In the face of those changes, robust risk management frameworks will position organizations to take advantage of the changed environment, a new white paper suggests.
The report, Everything You Know Is Wrong: New Risk Management Paradigms in the Post-Pandemic World, from Advisen Ltd. and sponsored by AXA XL, notes that organizations of all types and sizes were forced to modify their operating models to survive the pandemic.
Many of the changes—which are also likely to remain in place going forward—have altered those organizations’ risk profiles, prompting a need for new risk management and insurance strategies after the pandemic.
Among the changes the report notes are an increase in remote working, which has increased cyber risks while reducing the frequency of other losses due to fewer employees at the workplace; an increase in online shopping, which has put pressure on brick-and-mortar retailers and reshaped supply chains; and fewer vehicles on the road, which affected auto-related risks.
With those changes, “Pre-pandemic insurance and risk management strategies may not be relevant in the future,” the report suggests. “Risk managers and their brokers must understand how risk profiles have changed and ensure that risk management programs keep pace with evolving exposures. They also need to reassess their insurance programs to be certain that coverage aligns with their risk profiles and ensure that coverage gaps are identified and managed.”