Most importantly, understanding how to use risk assessments and business impact analyses to drive innovation and make forward-thinking decisions is key. Doing so can lead to benefits that will multiply well beyond 2021, including cost savings and gaining an advantage over competitors who are not thinking as strategically.
For organizations this has meant re-thinking digitalization strategies and doubling-down on information technology (IT) spending, cloud capacity, and infrastructure to boost bandwidth, ensure business continuity, and retain customers.
- S&P Global Ratings, How COVID-19 Has Changed Insurance, 2020.
One unforeseen positive outcome of the mass shift to remote working has been the necessary digital transformation that has taken place in response to extended quarantines. According to recent KPMG insights, the pandemic has set the insurance industry on the fast-track to technology adoption. More and more insurers are shifting department operations — such as internal audit and SOX management, risk management, and compliance activities — to cloud-based technology platforms that, in addition to enabling business continuity and remote collaboration, are creating efficiencies by automating and streamlining what were once manual business processes. The long-term effect of adopting enterprise technology solutions will be creating a foundation for efficiency across business functions that will continue benefiting your insurance organization beyond the duration of the pandemic.
Consider prioritizing an investment in a cloud-based ERM solution that can help your organization centralize its risk management activities. Pandemic challenges aside, managing risk across a large organization is incredibly complex and involves countless moving parts. Trying to keep pace in a volatile risk environment, while keeping all stakeholders up to speed, can become a perilous feat without the right technology stack. The right ERM solution can help insurers maximize collaborative efforts between internal audit, risk management, and compliance groups by centralizing all risk management activities in one place. Seek out ERM solutions that clearly demonstrate the ability to:
One downside to the rapid digital transformation of the business landscape has been increased systemic vulnerabilities to cyber attacks. Even prior to the pandemic, cyber risk was considered one of the biggest threats to modern organizations. Now, if insurers are to be a part of the solution to growing cyber risk, as suggested by recent analysis, then insurers themselves must set the example of having strong infosecurity compliance practices.
Now is the time to invest heavily in cybersecurity and privacy management initiatives, including ramping up your compliance program through adopting best practice information security frameworks. To go one step further, set a goal to obtain certifications for frameworks that are highly regarded by your industry, e.g. ISO, NIST, PCI DSS, and SOC 2 (if you have not already done so). Obtaining a certificate of compliance with any of these frameworks is one of the most impactful ways to protect your business’s data and network infrastructure — and the data and privacy of clients and partners — in addition to helping drive revenue.
Managing your cyber controls and compliance program in a solution that fits your organization’s needs can be a cost-effective and efficient way to streamline your path to certification, while simultaneously reducing the challenges and risks of managing compliance frameworks using spreadsheets, email, and shared drives.
In short, a volatile risk environment in 2021 presents an essential opportunity for insurers to push strategic initiatives that will set them up for success this year and beyond. Forward-thinking insurance organizations will rise to the occasion to restrategize and innovate — putting them at a significant advantage over companies who do not.