On May 31 the latest AGERS Risk Managers Meeting was held with 25 professionals taking part from the sectors of heavy industry, the metal industry, logistics and transportation, distribution, hospitality, energy, food, banking, telecommunications and chemistry.
The subject of International Insurance Programs was widely debated concerning how to manage and regulate them in legal and fiscal terms. The lively discussion addressed the various interlinking programs between the master and local policies and policy mechanisms such as DIC / DIL and the inclusion of the financial interest guarantee. During the conference of the previous day, risk managers heard about the grey areas and legal problems that make these complex structures collide with the regulations of the master and local programs, potentially invalidating their actions from a formal and legal point of view. The tax optimization of insurance costs for companies has hastened the need to study in greater depth the balance between required technical insurance structures and their regulatory validity.
In view of this problem which is not new but which now needs to be immediately addressed, AGERS decided to establish a panel for the purpose, defending the interests of its members and seeking to provide value to the overall insurance market.
Subsequently, the vision of the risk manager in business was discussed: dependencies, organizational structures, mission and future. In this regard it was agreed that advances in the positioning of this role were slow but changes were visible and they were oriented towards an improved and more relevant figure. Contribution of value, integration, interrelation with other areas such as the incorporation into the company Crisis Committee and projection of confidence to senior management faced with uncertainty are key elements to this reality.
As scheduled in the agenda of the morning, finally the issue of Cyber risks was addressed, providing the view of risk managers on this challenge in their companies, within the strategy set by the AGERS Risk Managers Area and specifically their cyber risks working group.
AGERS Congress public
Huge success of XXIV AGERS Congress With the main topic being the risks of internationalization before the growing business activity in foreign markets
More than 300 risk managers and directors of insurance brokers and insurance companies took part in the Spanish Congress of Risk management and Insurance and the event was considered to be one of the most interesting in recent years.
The speakers considered the internationalization of businesses to be the key element to combat the economic situation and they called on the governmental and transnational bodies to tackle loopholes in international insurance programs and coverage.
Small and large businesses were warned of the magnitude of cyber risks which effect a million people every day and which are caused by hackers (30%) and human error (50%).
The consultants stressed the priority of reputational risk and spoke of the imminent creation of the Chief Reputational Office in leading companies.
The contributions made by the AGERS environmental working group to the modifications in the Environmental Responsibility Act were presented.
The Insurance Department recognized the European delay in regulation caused be the delay of the Solvency II Directive and expressed concern over the expected failure of the draft agreement scheduled for October 2013.
Madrid May 30: “In the economic recession in which we find ourselves, with significant decreases in the Spanish GDP and a steep increase in unemployment figures, where recovery looks set to be slow and full of uncertainties, the only consensus and the only thing we can be sure about is that the Spanish companies that want to come out of the crisis and grow must pursue the route of competition and international projection”.
With this reflection, Pedro Tomey, Managing Director of AON and honorary member of AGERS, opened the debate of the XXIV Congress of the Risk Management and Insurance Association which was celebrated today in the Meliá Castilla hotel in Madrid. The four experts invited to the first panel of Economic, Political and Internationalization Risk, agreed that the global market offers opportunities, but they warned of the necessity of implementing adequate international programs for risk assessment and cover.
- The lawyer Pablo Wesoloski (DAC Beachcroft) called on the national and international bodies to address the lack of regulation, referring to it as a “regulation orphan”.
- Fernando Gortázar (AON Global Client Network) provided his global consultant vision and defended “the rigorous risk management which takes into account the cultural factors and country risk”.
- Alfredo Arán (Mapfre Global Risk) was in agreement and asked companies to “insure with companies that have experience in internationalization”,while
- Enrique Asenjo (CESCE) referred to his experience in the Brazilian market and in general and the necessity to create tools and frameworks that “facilitate the financing of exports and build support in the countries of destination”.
AGERS Congress Inauguration
The opening of the Congress took place at 9.00am and was conducted by the President of AGERS, Ignacio Martínez de Baroja (Hispasat), the association’s Vicepresidents Miguel Ángel Zarandona (El Corte Inglés) and Ubaldo Llorente (SEUR) and by the Secretary General, Gonzalo Iturmendi. Pablo Muelas, representing the General Directorate of Insurance and Pension Funds, gave the Opening Speech of the Conference, in which he highlighted concern over the delays in the Solvency II Directive which in his opinion “is negatively affecting Europe by failing to reach agreements on regulation in this area”.
After a break in which over 300 participants exchanged views and developed an active network of interaction, the second panel was initiated on the issue of cyber risk which was moderated by the Director of the magazine SIC (Security in IT and Communications), José de la Peña. Interest in this second debate was evidenced by the data contributed by participants, including the startling figure of the one million people who fall victim to cyber attacks daily.
- Frederick Shaw and
- Carlos Rodriguez of AIG, leader in cyber risks coverage,
- Angel Salmeron (March – JLT) and
- Antonio Moreno (ACE)
were in agreement on the potential magnitude of a cyber attack and on the essential speed of reaction. Proper software architecture and good management of these risks are essential in order to tackle “this real and increasing risk which we must protect ourselves against”, they said.
After dinner, the Congress continued with the third panel Reputational Risk, considered to be the most significant risk with the greatest potential impact on business activity in a globalized society open to social media and citizen activism”. “I’ll be rich if I can keep my reputation”, with this quote from Plautus,
- Jose Luis Solis (Earnst & Young) began his presentation, to raise awareness among the managers and attendees of the utmost importance of corporate reputation in this day and age. “Leading companies are creating the position of Chief Reputational Office to manage risks that may affect financing, value, capacity to attract talent and business activity”.
- Jesús Álvarez Sánchez de Loma (CACUMEN) used similar terms to insist on the differentiation between internal factors (customers and stakeholders) and external (e.g. social media) to establish appropriate strategies. “If I have no intention of competing, I have no intention of creating a reputation”, he said.
- The panel speakers also included Jose Manuel Black (Allianz GCS) and
- Thomas Hoad (Klin Tokio Marine) who presented management tools and examples and case studies.
The last panel, dedicated to Environmental Risk, opened with the presentation of the contributions that the AGERS environment working group has made to the changes in the Environmental Responsibility Act, due to be put into force by the end of 2013.
- Mario Ramirez, Head of Insurance and Risk for CLH and member of the Board, was asked to summarize and moderate the table.
- Jourdana Sauvaire (RISKIA) also participated and referred to the MORA Program available on the Ministry WEB as well as the simplified method of environmental risk analysis for SMEs. This was followed by
- Juan Fernández Montes (D&O of AXA Corporate Solutions) who highlighted the three guarantees given by the insurance industry in the area of environment: contamination between individuals; purely ecological damage and damage to own property. And finally,
- Fernando García Rodríguez (CLH) gave a case study on emergency environmental assessment.
Representatives of the Board of Directors of the Spanish Association of Risk Management and Insurance (AGERS) were extremely satisfied with the XXIV edition of the Spanish Congress of Risk Management and Insurance which reawakened maximum interest in the whole area of risk management and financial institutions, attentive to the results of the event. It brought together strong representation from the professional risk management and insurance sector to share ideas and make proposals on the issues most
relevant to the sector and the overall economy. This year they were joined by a large number of students. The activities end tomorrow, May 31, at 9.00 with the habitual Risk Managers’ Meeting which will be held at the headquarters of the CEIM.
For more information
AGERS, C/ Príncipe de Vergara, 86, 1ª Esc. 2º Izq. – 28006 Madrid
Tel. 91 562 84 25/609440842 – Fax 91 561 54 05
AGERS is a non-profit organization founded in April 1984 in order to promote, research and develop Risk Management in Spain. Among its over 200 associates are prestigious Companies and their Risk Managers, Brokers and Insurance Companies as well as the most important Consultants and Analysis and Valuation Companies operating in Spain. AGERS is a member of FERMA (Federation of European Risk Managers Associations) IFRIMA (International Federation of Risk and Insurance Management) and ALARYS (Latin
American Association of Insurance and Risk).