Aspen’s Cloutier warns SRCC risk will continue to escalate

Risks related to strikes, riots and civil commotion (SRCC) are set to increase in light of growing political polarisation and economic inequality, according to Aspen’s Mark Cloutier.

Cloutier, who serves as executive chairman and group CEO at Aspen, noted during a panel discussion at The Insurer’s Pre-Monte Carlo Forum that the plethora of elections taking place over 2024 has further exacerbated the risk.

“We have evidence of what can happen now in the US – some people still try to deny that 6 January happened, but it happened and we are now in an even more divided and angrier state of mind,” he said. “So I think that that risk is very much going to play on people's minds as we go forward.”

As well as populist and anti-establishment movements, Cloutier also noted increasing unrest – particularly in the UK and Europe – related to greater economic inequality around the distribution of wealth.

“Directionally, where that risk is going more broadly, globally, I think there's going to be an ever increasing element of risk around civil unrest. So I think it will play big,” Cloutier added.

Public-private partnerships for systemic risks

When questioned on the topic of public-private partnerships for risks that are inherently systemic to the reinsurance industry, Cloutier acknowledged the merit of such mechanisms in select cases.

“As a capitalist, hopefully a compassionate capitalist, I would prefer to see the capital markets and the insurance markets get to solving some of this stuff before it becomes necessary for public-private solutions,” he said.

“There may be some things that we just simply can't solve for without a public-private solution, but there is a lot that I think could come into that realm that we could avoid coming into that realm, which is inefficient and will ultimately probably lead to less than ideal solutions.”