A Case Study, affirming the value and logic of fronting (or re-insuring) a captive–greatly simplified with parametric triggers–for Non-Damage Business Interrption (NDBI). Katoen Natie survived the pandemic by securing NDBI cover through its captive – something thought to be a near-impossible task. Chief risk officer Carl Leeman explains how he did it, and why he won’t stop pushing to test his captive’s potential.
Triggered by the challenges at the Boeing Company, a risk executive and her leadership team use insurance strategically to allay her firm’s customers’ new fears of quality and safety.
It’s the end of a miserable quarter as Boeing Company’s reputation crisis hits day 92. Equity is down 35% to peers: 22% worse than Southwest Airline’s 13% day 92 under performance.
The new program “will create new incentives for individuals to report misconduct,” “If anything (said a defense lawyer), I think you’re going to see more scrutiny on this, […] And the risks are increasing.” The increased risk of discovering an adverse event is not unlike placing an additional bullet in the chamber in a game of Russian Roulette. But with risks increasing to all companies, and risk being the basis for discounting value, all companies will be equally discounted. That will be hard to appreciate in a stock market that is soaring. Until it isn’t. That’s where we come in. With reputation risk forecasting, management, and insurance, Steel City Re helps companies build and prove to stakeholders their thoughtful risk management and dutiful governance over all that is mission-critical. It is an authenticated story stakeholders can appreciate and value.
Parametric commercial insurance: name your price. All-risk, outcome-based loss in enterprise value measured by an index of reputation value.
Reputation risk management is an efficient strategy for interconnected risk. “Risk interconnectivity — the interdependence of various risks, illustrating how one risk can affect or amplify others across systems — is of growing concern to global risk managers. […] Andrew Chung, litigation, arbitration and investigations partner at Linklaters, said the key enterprise risks that are top of mind for clients today are interconnected. He explained: “We are seeing how risks across financial crime, cyber, ESG and energy transition, digital transformation and AI, and geopolitics including supply chain and sanctions all have common elements and data, so now require an enterprise-wide and holistic lens more than ever, to properly manage the risks.”
Three vignettes of risk managers gallantly using Steel City Re’s reputation risk solutions to forge enterprise resilience.
![Nir Kossovsky, CEO of Steel City Re, an insurance provider for reputational risk, said his firm’s Reputation Resilience Monitor for Tesla indicated little concern about Musk’s pay package, but real concern about the firm’s cost of operations, declining net income and future prospects. […] “However, should stakeholders become excitable, then any incident — even another round on the pay package — could trigger a shift in their expectations from fandom-level support to anger and disappointment,” he said.](https://steelcityre.com/wp-content/uploads/2024/02/20240205-Tesla-Musk-Pay-Package-Reputation-Steel-City-Re.jpg)
Nir Kossovsky, CEO of Steel City Re, an insurance provider for reputational risk, said his firm’s Reputation Resilience Monitor for Tesla indicated little concern about Musk’s pay package, but real concern about the firm’s cost of operations, declining net income and future prospects. […] “However, should stakeholders become excitable, then any incident — even another round on the pay package — could trigger a shift in their expectations from fandom-level support to anger and disappointment,” he said.
$5 trillion worth of shareholder votes want more ERM this year. The investment stewardship team at Blackrock, the world’s largest asset manager, will put “increased focus on how companies are strengthening financial resilience.” It is a is a challenge Steel City Re has been anticipating since 2007.
Environmental issue? Investors scrutinizing! According to Kossovsky, shareholders seem most concerned about the impact of fines and other costs, but, in the long run, usually don’t expect environmental incidents to materially impair revenue.