Lloyd’s Calls for a More Risk-Aware Approach to Emerging Risks
As geopolitical and technological risks become increasingly interconnected, the insurance market needs to focus on becoming more“risk aware and not risk off”, according to Rachel Turk, Chief of Performance & Strategy at Lloyd’s.
Speaking at AM Best’s Europe Insurance Market Briefing in London, Turk highlighted the increasing connections between geopolitical events, supply chain disruption, technology, trade and energy infrastructure. She argued that underwriters need greater geopolitical awareness to understand how these exposures can move across increasingly complex portfolios.
Emerging technology is another area where insurers may need to rethink their approach. On AI, Turk argued that simply excluding the risk does not make the exposure disappear and called for more intelligent thinking about how AI risk should be approached and covered.
She also warned against the insurance market becoming less relevant to clients by failing to develop protection that reflects modern exposures, including intellectual property, digital infrastructure, AI and supply chain continuity.
Five priorities were identified for navigating the changing risk environment: being clear about what is covered, understanding exposures across the whole portfolio, pricing for current realities, responding to changing risk profiles before results force action, and protecting profitability so the market retains the ability to innovate.
The central message is not that insurers should accept every exposure, but that the industry must continue finding ways to understand and price the right risks rather than relying on exclusions as complexity increases.
