The Energy Insurance Market "Must Innovate to Survive"
Delegates call for action from insurers as emerging risks dominate the agenda in Bangkok Insurers must innovate if they are to survive today's competitive market environment and provide the kind of solutions required by today's energy industry. That was the unequivocal message delivered by delegates at the end of Willis Towers Watson's inaugural Asian energy conference, held from January 20-22 in Bangkok, Thailand.
The key threats to the Asian Energy industry that were discussed at this event were those emanating from the cyber, human capital, supply chain arenas, after which the conference turned to the possible responses available from an analytical, legal/regulatory and risk transfer perspective.
Opening the conference, Adam Garrard, Head of Willis Towers Watson International, reflected on the way in which the risk landscape for major corporations had changed during the course of the last nine years or so. "According to Price Waterhouse's Annual Global CEO Survey, none of the top five risks considered the most critical by CEOs in 2007 have made the top five in 2015" said Garrard. "Instead digital change, unforeseen competition, cyber breaches, achieving the right talent mix and changing customer behaviour are now at the top of the list, displacing the more familiar risks of over-regulation, scarcity of natural resources, pandemics, downturns in major economies and fluctuating commodity prices. It's quite a change."
Willis Towers Watson's Adam Garrard opened the conference
As shifting political and social pressures - particularly with regard to air quality, global warming, Corporate Social responsibility and the move to a low carbon economy have changed many of the dynamics of the energy industry, so the risk management needs of the industry have changed, noted Garrard. "There is still a significant level of under-insurance in the industry. In this new risk landscape, it needs different solutions to be provided to manage these new risks effectively" he said.
As our chart shows, delegates at the event seemed very much to agree with him. Perhaps it was not so surprising to see that all the clients at the conference did so, but more surprising was that nearly 80% of the global insurer representatives present also agreed, as did 95% of the Willis Towers Watson delegates present.
Other key Asian Energy/Power company takeaways from the conference were:
At the end of the conference a distinguished panel of delegates discussed the motion "The Energy Insurance Market Must Innovate to Survive". While appreciating the need for innovation, Cik Raziyah Yahya, General Manager, PETRONAS Group Insurance & Risk Management Department, also stressed the importance of maintaining long term partnerships with selected carriers in the insurance markets - a stance which was welcomed by the insurers and brokers on the panel.
The next Willis Towers Watson Energy conference will be held at the Hyatt Lost Pines Resort near Austin, Texas from May 17-19 2016. Meanwhile, if you have any other questions concerning our Bangkok event, please contact Paul Ward, our Natural Resources Regional Industry Leader for Asia (Paul.Ward@WillisTowersWatson.com, + 65 6591 8081).
Cik Raziyah Yahya, General Manager, PETRONAS Group Insurance & Risk Management Department makes a point during the final panel discussion. Listening are (from left to right): Mike Newsom Davis, Justin Blackmore and Cliff Jeyes (Willis Towers Watson), David Hawksby (Talbot Underwriting Services (US) Ltd), Tilden Goh (AIG) Phil Ellis (Willis Towers Watson).