The war in Ukraine is one of the major crises of our times. It is exposing the limitations of insurance.
Mactavish’s business resilience survey found that 90% of companies expect the Russian invasion of Ukraine to impact the resilience of their business, while 77% of businesses have already been forced to make changes around their supply chain as a consequence of the war.
The primary role of insurance is to provide protection against financial loss from unforeseeable or unlikely events. However, past crisis events have exposed the limitations of this model and current insurance practices are now under the microscope.
The problem is that this comes at a time when companies are more exposed to risk and require more accessible support.
Instead, the industry’s response has been characterised by a withdrawal of capacity.
With traditional insurance no longer being systematically suitable, due in part to an over-reliance on standardised policies, there’s growing pressure on policyholders to step-up and build in-house expertise to ensure the viability of their insurance programmes.