From: Captive International

The COVID-19 crisis has exposed how interdependent risk has become in the modern world, and the extent to which a single event can devastate whole economies, let alone individual businesses. The world must respond by becoming much more creative in its approach to risk management, and captives should be at the heart of those efforts, says Michael Zuckerman of Temple University’s Fox School of Business.

The philosopher and thinker George Santayana observed that those who cannot remember the past are condemned to repeat it. This concept of appreciating the past is vital for identifying and assessing risk. Risk managers need to know history to understand risk and the tools required to manage it.

History teaches us that new threats, or risks that seem to be unique, are not emerging but are evolving risks. Pandemics, for example, are not new: according to the Centers for Disease Control and Prevention (CDC), the 1918 H1N1 virus (Spanish flu) pandemic was the most severe in the modern era. Medical technology has advanced exponentially since then, but the COVID-19 pandemic has taught us that risk evolves and will continually test our resourcefulness and ability to respond.