As insurers track both old and new risks heading into 2019, here’s one that carriers don’t typically consider: The White House.
David Wessel, director of The Hutchins Center on Fiscal and Monetary Policy, cited the Trump White House and its volatility as a major political risk during a Jan. 17 panel discussion at the Insurance Information Institute’s Joint Industry Forum.
“The top geopolitical risk, I am afraid, is in the White House,” Wessel said. “I don’t think that people in Washington have confidence that this administration could handle a crisis as ably as the Bush or Obama administrations. That would be at the top of my list.”
Earlier in the panel discussion, Wessel cited the ongoing situation in Washington with the partial government shutdown as a short-term risk of its own with wide-ranging implications.
“It is causing economic distress, an erosion of trust in our government, and it makes me worry about when we hit the debt ceiling later this year, on March 2,” said Wessel, also a senior fellow at the Brookings Institution. “This business about not being able to get business done in Washington is having real economic effects. It is also making it difficult for Washington to deal with really serious economic issues.”
Wessel sees other, broader global risks as potentially causing harm to both insurers and society alike. They include:
Panelist Jay Gelb noted other risks to worry about in the coming year. Gelb, managing director, Barclays, said that flood insurance and cyber attacks offer both risk and opportunity for insurers in figuring out ways to cover both effectively. Distracted driving is another risk to follow, he said, with the hope that personal auto insurers find “more proactive ways of addressing the dangers of distracted riving.”