Aon Benfield Conference Underlines ‘Complexity’ of Catastrophic Events

Aon Benfield, the global reinsurance intermediary and capital advisor of Aon Corp., will urge insureds and insurers to “look at the bigger picture as cat events become more complex,” at its 12th Hazards Conference in Surfers Paradise, near Sydney, Australia on September 29 to October 1.

“Catastrophic events are becoming more complex due to the increasingly interdependent global economy and the technological sophistication of society,” said the bulletin. “For example, a volcano in Iceland caused massive travel disruption; a mechanical failure led to the Deepwater Horizon oil spill; unmapped faults triggered two large earthquakes in Christchurch; La Nina is linked to a cluster of meteorological events in Australia; and a massive earthquake and tsunami in Japan crippled nuclear facilities and triggered supply chain disruptions across the world.”

As a result of these events the conference “looks at the bigger picture and acts as a catalyst for insurance company leaders to address wider issues to support businesses, individuals and society as a whole in coping with extreme events in today’s complex world.”

Robert De Souza, President APAC / CEO Australia & New Zealand, explained: “Navigating this world of increasing catastrophic complexity requires new ways of thinking about risk and how to manage it. Our society has been transformed in recent decades by globalization, increasingly complex technological systems, shifting economic power and new regulation. Combined with the universal use of the internet, business leaders face the challenge of managing systems too complicated for them to understand individually. This requires new risk management paradigms and robust internal controls.’

Rade Musulin, COO of Aon Benfield Analytics APAC, added: ‘Overall the industry has successfully met the succession of challenges from 9/11 to the Great Tohuko earthquake. However it is not a time for the industry to become complacent as catastrophic complexity is certain to be a major issue in coming years. The conference is designed to stimulate thinking among our delegates about big picture trends ahead of us.’

It has become increasingly necessary, as Aon notes, to have access to “improved data, catastrophe models and dynamic financial analysis,” as these are the “keys to the insurance industry handling the increasing complexity of catastrophe risk.”

Source: Aon Benfield