Welcome to the "dynamically changing normal"

Today Swiss Re Institute's Chief Research & Innovation Officer Jeffrey Bohn joined ICMIF (International Cooperative and Mutual Insurance Federation) members for one of the MORO (Meeting of Reinsurance Officials) webinars. From where he sits, he has insights to spare - and when he shares them, they're invariably illuminating.

First, though, I just had to pick something he said as this article's title - it's very much true, isn't it? We always hear about a "new normal" - all the more so in these COVID times. But the truth is that the "normal" is always changing. There was always truth in the old saying that "change is the only constant" ... maybe now's the time when we finally accept that notion. I like the notion of a "dynamically changing normal."

2020 most certainly has shown, maybe more so than ever before, not only that the risk landscape is far and wide, but also that all of everything is ever more connected.

The old notion of insurance, of understanding a risk, issuing a policy and then paying out when and if, is - must be - on it's way out. Jeff Bohn highlighted how the insurance industry is changing to offering what we call "resilience-as-a-service", to companies that help to predict and prevent. Instead of waiting for disaster to strike, we act in line with our company's purpose: "We make the world more resilient" by offering mitigation and risk preventation measures.

Swiss Re Institute, Swiss Re's research think tank, researches, develops and delivers a number of tools to better understand what will happen in the future. These days that, of course, means data-driven, machine-intelligence technology.

Bohn explained how, by ccordinating new technologies, the insurance industry can greatly boost resilience (and with it, of course, its business capabilities and opportunities).

"The convergence of these different technologies will bring us a number of new opportunities for building better resilience - and that's something that is a big part of our R&D effort at Swiss Re Institute."

He shared insights into SRI's resilience modeling (using hybridized physics-based models and machine learning) and howed how the approach allows for better prediction (as well as portfolio optimization). He also outlined Swiss Re Institute's "Risk Intelligence Factory" - a data-harvesting engine with a replicable and scalable framework that curates and aggregates diverse data sources and enriches with accumulated risk insights to deliver resilience solutions and services. When I can, I'll report on this in more detail.

"In the past entreprise machine intelligence work often failed, because those technologies were neither replicable nor scalable. That has changed, and that's another reason why I'm much more optimistic."

Was COVID part of the webinar? Of course! These days it seems impossible to have the pandemic not encroach, whatever the topic. And here it made perfect sense - one of well-known global risks is the global supply chain. It was massively disrupted by COVID - but even before the pandemic, was already very much in the midst of technological transformation (see slide below).

Bohn showed the non-system and systemic supply chain risks - and how data-driven risk monitoring facilitates tracking. With the "dynamically changing normal" being the constant, tools like the "Risk Intelligence Factors" are key to delivering on the increasing demand for resilience and risk transfer solutions.

The time with Jeff Bohn touched on a great many topics - among them also cyber risks and algorithmic risks ... which reminds me - I wrote about that fascinating topic when Jeff presented at ETH last year - see post below.

There was much more, of course. Jeff Bohn showcased just how much "resilience-as-a-service" can mean for businesses. He called it "future-proofing" (another term I like), and also showed how this can work in tandem with Swiss Re Institute's "Insurance SDG Calculator" - to set objectives, and to measure exposure and impact ... this is definitely something I'll also write more about!

I'll leave it at this for now - when the recording becomes available, I'll add the link. In closing I can only say that, from what I see on a daily businss at Swiss Re Institute, a great deal is happening on many fronts. Research looks into the future, but it also delivers into the now with new data-driven offerings that make "resilience-as-a-service" the new normal (uh-oh, there, I did it again).