I just learned that November 3 is National Cliché Day. Who knew?
So, what better time than now (before it’s too late!) to bust the cliché that insurance is a boring industry.
The cliché might be rooted in the idea that insurance is all about remaining cozily in some imaginary “safety zone”. Or maybe in the fact that the industry’s visual surface tends to be one of dull-looking paperwork full of fine print.
But think about it: the entire industry is rooted in risk!
Automobile accidents and other forms of property damage are only the start of it. There’s liability risk – the risk of being sued: product liability, professional liability, employment practices, directors and officers, errors and omissions, medical malpractice – the list goes on, and insurance professionals have to understand these areas of risk intimately to price policies, set aside appropriate reserves, and pay claims in a timely fashion.
Is climate-related risk keeping you up at night? You’re not alone. Insurers have been working on that one for decades, empowered by sophisticated modeling and analytics capabilities. They aren’t just worrying about extreme weather and climate – they’re partnering with other industries, communities, and governments to do something about it.
And, speaking of sophisticated technology – what about cyber risk? The average cost of a data breach rose year over year in 2021 from $3.86 million to $4.24 million, according to a recent report by IBM and the Ponemon Institute — the highest in the 17 years that this report has been published. These kinds of numbers add up quickly. Unlike flood and fire – perils for which insurers have decades of data to help them accurately measure and price policies – cyber threats are comparatively new and constantly evolving. The presence of malicious intent results in their having more in common with terrorism than with natural catastrophes.
These are just a few of the risks types insurance professionals look in the eye daily, working with a wide range of experts across industries and disciplines to meet them. From the individual and family level to businesses large and small to the global economy, insurers play a critical role as both risk-management partners and financial first responders.
Keep these things in mind next time you catch yourself stifling a yawn at the mention of insurance!