Lloyd's chairman Max Taylor has named his insurance equivalent of the four horsemen of the apocalypse: the weather, ecommerce, claims against corporate executives and loss of brand reputation.
Speaking at the San Antonio Chambers of Commerce this week, Taylor said these key risks are the greatest threat facing businesses today. And he warns the emergence of new risks is accelerating as business priorities and methods change.
nWeather – "Two trends are increasingly clear. Firstly the world is getting warmer, and secondly, it is a fact that the world's population is becoming increasingly concentrated in disaster-prone areas.
"For example, 50% of the US population now live in the country's coastal areas. Combined, these trends make the potential for weather-related catastrophe loss greater than ever."
- ECommerce – "The world of ecommerce is still learning about the challenges and risks of ecommerce and how to protect and insure against such risks.
"Security, computer hacking, copyright infringements and business interruption can all pose serious problems for today's businesses."
- Claims against corporate executives – "Today about 80% of large corporations purchase directors' and officers' cover. It is not just a real risk for large publicly traded companies – in 1996 10% of companies with assets of less than $100m reported claims against directors and officers.
'The largest number of claims against directors and officers is in Northern California, the home of Silicon Valley.
The financial world now recognises intellectual property and a company's brand as major revenue generating assets. They will appear on more and more balance sheets and become more of a focus for risk managers.