Connected risk comes of age
Russell Group’s Suki Basi celebrates 10 years of the concept of connected risk.
In 2014, Russell launched ‘connected risk’ – a concept that few people understood – in a thought leadership campaign that resulted in advisory involvement with the Airmic “Road to Revolution” project in 2017/18 , conversations with the Bank of England, and a memorable evening presenting at Chatham House in 2018.
In 2018, we formed the Russell Corporate Working Group, a collection of leading corporates, to move the connected risk conversation from the (re)insurance market silo into the business world. In 2024, this group has 33 corporates involved, of which half are FTSE 100-listed, encompassing both insurance and risk professionals.
Innovation is just a means to an end
One of the corporates of the working group recently unveiled a five-year business resilience insurance policy providing its captive with a connected risk- and outcome-based solution, supported by three of the world’s largest reinsurers. Innovation has been a buzz word in the industry for years, but the real mark of being a pioneer is to have the transforming skill to enable innovation to be realised.
Building a new market
Initially, the outcome-based solution is part of a complex structured policy that includes an element of risk financing against a range of major events, with minimal exclusions. It is anticipated that, as the exposures become better understood and improvements in data and analytics offered by firms such as Russell come to fruition, there will be a major industry shift to innovative risk transfer.
The group was originally formed in 2018 to focus on ‘Connected Risk’ and to explore how data analytics solutions could help both corpora t e risk managers and (re)insurers design risk solutions more suited to a connected trading environment.
As Kevin Steed, head of group insurance at AstraZeneca, said: “The level of dialogue between the various risk managers on the Russell Working Group call was phenomenal, clearly outlining the common interest that insurance products need to be relevant, not just now, but also for the future. Sharing the learning and experiences should help all of us in our roles, and position corporate insurance as a headliner for innovation.”
It was a real privilege to witness history in the making – a new era for insurance with this tangible connected risk solution. The insurance market has been perceived as being resistant to change, but here is an example of the market leaders displaying true innovation that works for the greater good.