Is focus on financial risks diverting attention?

Lloyd’s CEO Richard Ward has warned that the current focus on financial risks could be diverting attention away from other important issues such as extreme weather, cyber security, and piracy.

Speaking at a function during the Association for French Risk Managers annual conference in Deauville, Ward said that it’s the low probability, high impact risks that can have the biggest effect such as September 11 and hurricane Katrina.

The financial crisis has put a spotlight on risk management within organisations, but Ward reminded the audience that it was incumbent on risk managers not to narrow their focus. “Risk managers have a fundamental role to ensure that the members of their board don’t lose sight of emerging risks,” he said.

The economic climate has also prompted organisations to examine third parties they do business with. “Large corporations need insurance providers with: secure capital, global coverage, innovation. Lloyd’s offers all three,” Ward said.

He added: “As a market, we can offer multinationals some unique features. First, we are licensed to trade in over 200 countries, so we can cover most if not all of your assets across the world. Second, our syndicate system means risks can be spread over a variety of different insurance firms, providing you with more security and third, we offer a bespoke service, tailoring policies and premiums to individual clients. This is particularly helpful for complex, international companies.”

In the last two years Lloyd’s has worked to strengthen its presence in Europe. Last year, Guy Antoine de la Rochefoucault was appointed to lead Lloyd’s French operations. Guy Antoine has over 25 years experience in the insurance and reinsurance industry and will play a vital role in helping risk managers access the Lloyd’s market in France.

Lloyd’s has already worked with some of the largest energy, finance, aviation and satellite businesses in France, including Airbus, Total and Air France. The French market is the second largest source of revenue for Lloyd's in Europe with a turnover of over 500 million euros in 2008.