Organising Risk Management

René Doff

Risk management within the insurance industry has developed strongly, especially as the financial crisis that begun in 2008 has contributed towards insurers becoming more aware of some important risks. However, this development has been ongoing since the early 2000s. In professionalising risk management, insurers have partly followed the route taken by banks, with a number of financial conglomerates such as ING and Allianz leading the way.

In previous chapters, we have looked in detail at the various risk categories that were identified in Chapter 2, and insurance regulation, of which Solvency II is the most predominant. It was also explained in Chapter 15 how economic capital outcomes can be used in the framework of management control. All these applications have been relatively technical and quantitative in nature. However, this chapter will look at risk management from an organisational perspective, firstly by looking at the major theme of corporate governance, focusing on how to structure a countervailing power for all levels in an organisation. Such a countervailing power will improve the quality of decisions. The framework of three lines of defence is also a way to