Steel City Re combines financial modeling with behavioral economics to enhance governance, leadership and control practices, quantify reputation risk, and leverage parametric insurances strategically—to tell a simple, credible and completely convincing story. Benefits can be measured in stock price and credit costs; reduced fines; successful Caremark pleadings; and more.
Quantitative, bespoke, and objectively selective
Steel City Re’s services help manage expectations, mitigate anger and disappointment, and parametrically indemnify fortuitous losses.
Enterprise-level perils of reputation risk include social inflation (shocking verdicts), enterprise-wide economic damage, liquidity pressure, short-term earnings shortfall, and the paralyzing fear of a reputational crisis. Steel City Re’s Enterprise services provide clients with comprehensive, enterprise-wide frameworks for assessing and quantifying their reputational risk exposures, their potential corporate and personal impacts, and both assess and quantify the benefits of using reputation insurance products to manage and mitigate those risks.
Reputation today comprises up to 76% of a company’s enterprise value, according to executive insiders; and features second in ESG-centered institutional investor allocation decisions. It has influenced more than 30% of recent credit ratings, per Moody’s, and is now a colossal board peril. Protecting this value requires risk financing for named perils and layers of risk retention and/or transfer for ranges of losses.
Reputation insurances, approached on a parametric basis, addressing emerging risks and ESG compliance; and exploiting the power of captives, can profitably counteract the multiple negative effects of the current hardening P&C market.
A typical solution for reputation value loss may be anchored by a captive for risk retention and transfer with insurance policies led by the Lloyd’s syndicate, Tokio Marine Kiln. All Steel City Re risk financing and transfer policies are triggered parametrically. Separate additional towers for non-damage business interruption, crisis management, and related losses can be readily integrated, creating a more robust financial solution.
Derivative litigation strategies engineered to crush puffery defenses without offending Caremark are new and menacing; but for boards that oversee and monitor risk, innovative governance, leadership, controls and insurances can thwart these perils.
Marchand v Barnhill and In re Signet heralded reputation risk’s breach of boardroom doors. D&O coverage is insufficient to protect Directors and Officers against personal reputational damage caused in the court of public opinion. Steel City Re offers solutions for directors and officers who wish to oversee and monitor aspects of their operations that may be deemed “mission-critical”; i.e, ethics, innovation, safety, security, sustainability, and quality.
Reputation is an Enterprise Risk Management (ERM) issue requiring enterprise-wide systems to protect it through educating talent and developing information from all silos, who then report to the Board. Steel City Re has solutions for reputation risk governance and enterprise-wide reputation risk management that empowers a firm’s risk management apparatus with policies, practices, procedures, communication tools, and indemnification instruments as well as knowledge of behavioral economics and how that factors in stakeholder satisfaction and Board preparedness when the inevitable crisis occurs.