As an insurance company, we are in the business of evaluating, mitigating and managing risk. Our clients pay us to take on their risks – be it the risk of a life or health-changing event, a theft, fire, a car accident, a natural disaster, or almost any other risk imaginable. Managing risk is a top priority for us – and our clients.
Not only do we need to understand and measure risk, but also mitigate it. “Risk management is based on statistics and sophisticated models. Yet the human aspect is at least as important,” says Theo Berg, Director of Group Actuarial and Risk Management . “It is crucial that we know our customers and understand the risks they are exposed to. Our insurance experts can advise clients on preventing, reducing or avoiding certain risks.”
In addition to managing the risks of our customers, we need to monitor and manage our own operational and other internal business-related risk at Delta Lloyd. Is our internal payment system solid and safe? Do we have secure online systems for internet banking, asset management and treasury? Our Business Continuity Management unit monitors the risk of system failures and develops contingency plans to act in case of any serious problems.
Stricter regulation, partly triggered by the financial crisis, has moved risk management even higher up on the agenda. The international regulatory framework for insurance companies, Solvency II, requires that we describe and show detailed evidence of how we organise our risk management. Many of the revised regulatory requirements are already in place. To embed knowledge about the risk culture more widely in our organisation, we launched a risk management e-learning programme in 2012.
Fine-tuning and further developing risk management makes our company more efficient and secure, to the benefit of our customers, and helps us to make better decisions. Understanding risk makes perfect business sense.