Original text here from Patrice Bernard (LinkedIn)
In response to the profound changes shaping our world—climate change and its consequences being just one example—the insurance industry faces an urgent need to adapt to remain relevant. To address these challenges, Allianz France, in partnership with ENSAE and the Risk Foundation, has launched a research chair focused on emerging risks.
From the outset, Allianz acknowledges that the rapid transformations we are experiencing today pose a significant challenge to its industry. This is due both to the emergence of phenomena—such as extreme weather events—whose frequency, severity, and near-certainty challenge the very possibility of providing coverage, and to their novelty and explosive development, which leave actuaries without the historical data needed for accurate modeling.
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The multidisciplinary research project aims primarily to address these gaps by developing quantitative analysis methods that will enable Allianz to better understand and anticipate the evolution of risks in all their dimensions. This approach will particularly focus on natural disasters driven by climate change, with an emphasis on predicting their magnitude and medium- to long-term trends.
However, given the increasing likelihood that some risks may no longer be insurable through traditional methods, the scope of the research extends beyond insurability. It will also explore strategies for redistributing responsibilities (and associated costs) among stakeholders—insurers, reinsurers, policyholders, and public authorities—based on their expectations and behaviors, which will also need to be studied.
For similar reasons, another major area of focus will be prevention. Often overlooked until now, prevention is becoming a cornerstone of the insurance toolkit. Its aim is to reduce the probability of losses and better manage the damages that are covered. For Allianz, this shift also represents a critical opportunity to address a significant inclusion challenge. Prevention will be vital to extending protection to individuals and businesses that currently lack access to insurance.
A few weeks ago, I shared my thoughts on the inevitable upheavals awaiting the insurance industry amid today’s transformations, emphasizing the need for innovation—or even a complete reinvention—to maintain its relevance. Allianz’s initiative aligns with these concerns, and it is to be hoped that, beyond the research conducted through this chair, practical applications of the findings will emerge without delay. The urgency is real.
