More than eight out of ten European companies expect to increase their use of multinational insurance programmes over the next three years, according to research published by ACE Group.
This is primarily due to mounting apprehension about the “risk management implications” of their rising exposure to emerging markets.
The survey of 280 risk managers across Europe, part of ACE’s ongoing series of European Risk Briefings, also points to heightened concerns regarding the growing complexity of international regulation and the impact of cross-border risk profiles on the companies’ loss experience.
Respondents also worry about the changing liabilities their multinational operations face, according to the survey.
Four of the top six risks that they expect to create the greatest risk exposure for their multinational operation in three years’ time relate directly to liability issues. Cyber risk, which has a significant liability dimension was ranked second.
Environmental liability was ranked third, underlining a growing awareness of new and emerging liabilities. Professional indemnity and directors and officers liability were also in the top six.
Risk managers who took part in the survey cited multinational programmes as a clear way to improve consistency and compliance.
Close to a third of risk managers believe that multinational programmes allow them to make the claims process more efficient and more than a quarter that they can help them to control cost through economies of scale.
Andrew Kendrick, president of ACE’s European Group, said: “Achieving consistent, compliant insurance cover in this kind of environment is becoming more difficult under traditional approaches to insurance such as relying on a single global policy or a patchwork of uncoordinated local arrangements.”
“A comprehensive multinational programme is usually a better solution. We at ACE recognise that every good multinational programme is the result of a close partnership between the client, their broker and insurer.”
Risk managers that took part in the survey stated that they require more practical support from insurers to help manage multinational risks.
According to the survey, less than a third of risk managers are currently “very satisfied” with overall service levels on multinational programmes.
