Greater connectivity and technology are intensifying global risks and contributing to the world’s current state of volatility, according to Jacob Rosengarten of XL Group.
As a keynote speaker at the European Insurance Forum, the chief enterprise risk officer identified five ‘mega trends’, which he said “pose a significant risk to insurers and businesses alike”.
He said that “economic weakness in the West persists” and that despite the cull of military spending, other costs are rising, such as youth unemployment, in developed and emerging economies.
Rosengarten added that young people feel “alienated” from “key institutions”.
He suggested that failed global institutions can cause societies to “turn inward”, which results in “political unrest and instability”.
The failure of institutions could exacerbate concentrated areas of urbanisation, which, Rosengarten claimed, can accelerate infrastructure degradation and pollution conditions.
Rosengarten also made it clear that developing markets, which were once regarded as separate, now “link” to developed markets where supply chains are concerned.
Finally, he remarked that social media has played a significant role in the instability of some developing markets. “Small and oppressed groups can mobilise rapidly in a way that wasn’t possible years ago”.
“Many of today’s most pressing global risk management issues are intertwined. They are correlated in one way or another, especially in their potential and significant impact on the insurance industry and the businesses we serve,” added Rosengarten.
