Live From Riskworld 2023

Welcome to RIMScast. Your host is Justin Smulison, Business Content Manager at RIMS, the Risk and Insurance Management Society.   RISKWORLD draws engagement from various areas of the risk profession around the globe. This year, in live interviews recorded onsite from the floor of the Georgia World Congress Center, host Justin Smulison met with various guests to discuss the recent banking failures and their impact on risk and insurance, disaster preparedness, and how Japanese risk professionals present information and philosophies to their leaders in government and to interested corporations.   Join Justin and his guests to relive the excitement of Days 1 and 2 of the world’s largest risk management event.   Key Takeaways: [:01] About RIMScast. [:27] About today’s episode with interviews recorded live from the floor of the Georgia World Congress Center during RISKWORLD 2023. [:41] All about upcoming RIMS webinars, and more! [1:21] The RIMS Canada Conference 2023 has been announced for September 11th‒14th in Ottowa! The call for educational session submissions is open. Visit RIMSCanadaConference.ca for more information. [1:43] This episode’s interviews were recorded live at RISKWORLD 2023. Justin loves doing the live interviews and delving into the various perspectives of his guests. [1:55] Justin’s first guest is Paul Larson, the President of Financial Lines at Liberty Mutual. They met on May 1st before Paul’s session, “A Banking Crisis’s Impact on the Insurance Industry.” It was perfectly timed. That day, less than two months after the collapse of SVB, it was announced that JPMorgan had bought troubled First Republic. [2:36] Justin welcomes Paul Larson to RIMScast. [2:51] Paul’s session is about what’s happening with respect to the banking crisis, if there is one. Paul talks to risk managers on the corporate and financial services sides about how this could impact businesses. How did the session go, Justin asks. “Oh, we killed it! Knocked it out of the park,” Paul forecasts! [3:30] Paul’s take on the banking crisis is that it’s not at that stage yet. So far, we don’t have a significant credit issue. But will the interest rate risk become a credit risk? [4:10] The JPMorgan purchase of First Republic doesn’t much change the dynamic of Paul’s session. The SVB and First Republic failures resulted from liquidity issues and uninsured deposits. Both firms had significant levels of uninsured deposits, as did Signature Bank. [4:59] Banks should act as though the 2018 roll-back of Dodd-Frank had not happened.  Paul brings up the need for banks to manage liquidity risk, regulators to ask for change, and banks to manage their interest rate risk and asset-liability matching. [5:35] The Fed acknowledged that they saw the risk at SVB and should have been heavy-handed early on. [6:01] Paul thinks the directors and officers of SVB are going to be held accountable for the failure and we will see litigation as a result of it. The failure emphasizes the importance of having a strong Chief Risk Officer in place to manage the process all along. For over eight months, SVB did not have a CRO. [6:30] Justin had done an episode with the risk manager from Sterling Bank and Trust, Eleni Willis, about the failure of SVB and their lack of a CRO. She likened it to pulling your quarterback in the middle of a fourth-quarter blitz. Paul agrees it’s critical for a bank the size of SVB or First Republic to have a CRO and a succession plan if one departs! [7:04] Paul suggests the Chief Financial Officer of a bank become the interim CRO.  [7:21] RISKWORLD 2023 is the 21st RISKWORLD Paul has attended. Justin thanks Paul for being on RIMScast. [7:43] It was National Hurricane Preparedness Week, April 30th through May 6th, 2023. So Justin speaks to a preparedness expert, Alexander Walton, the National Director of Client Development at Blueteam. Blueteam does restoration construction and roofing. [8:11] Justin and Alexander discuss the trends in hurricane preparedness and things Alexander has seen as a worker on the ground. Hurricane season is coming up soon! [8:31] Justin welcomes Alexander Walton to RIMScast. This is Alexander’s first year attending RISKWORLD; he plans to attend going forward. He has been with Blueteam for just over seven months and in the risk management space for about six years. Before Blueteam, Alexander was the GM for a couple of ServiceMaster offices out west. [9:46] Blueteam is based in Boca Raton and gets the first hit of hurricane season. The Blueteam crews stay prepared and ready to go. [10:10] Blueteam’s mantra is preparedness. Blueteam’s proprietary software allows it to alert customers by location that may be in the line of a hurricane so the customers can have a better understanding of what to prepare for by boarding up and getting any equipment they might need to prevent the most damage. [10:52] Boca Raton is an hour north of Miami. Justin asks about the damages from Hurricane Ian. Blueteam’s takeaway from Ian was that you can never be too prepared. The more you can do on the front end, the easier it is for Blueteam to come and mitigate and prevent further damage from sitting water and potential structure failures. [11:44] How does Blueteam prepare for enhanced risks from climate change? Blueteam has been busy year-round, mitigating torrential rains and flooding and an earlier, increased tornado season. [12:33] Alexander notes that the technological advancements at Blueteam are in customer interaction. The proprietary software includes warnings for earthquakes, fires, freeze warnings, wind warnings, as well as hurricanes, so customers can take evasive measures to prevent damage. [13:28] Florida has had freeze warnings, flooding, hurricanes, and extreme winds this year. The freezes and windstorms are applicable around the country. Blueteam has seen a huge peak in business for repairs from those two climate disasters. [14:17] Alexander’s experience on the ground shaped his risk management career. He has insight into the customers’ perception, allowing conversations on how Blueteam can help on the front end and what to expect in terms of timelines and repair. These conversations build solid relationships. The customers know they are valued. [14:58] Alexander’s worst experience on the ground was from an internal fire with lots of smoke damage. He had to see that residents of a senior living facility were secure and repair smoke damage and mitigate water damage from the fire department. He had to get people back on track and into their normal routines as soon as possible. [15:43] Justin’s final guests today are from The Institute of Energy Economics, an arm of the Japanese government. Justin met them sitting in the DE&I Lounge, preparing for their Global Studio session, “Collaboration with an Energy Resiliency Working Group.” They were enthusiastic to be on the show and speak of energy! [16:09] Justin welcomes Akihiro Kimura, Hirotaka Mitsui, and Kentaro Hayashi of The Institute of Energy Economics in Japan to RIMScast. Akihiro Kimura, a risk manager, explains they are presenting the “new normals” of cyber risk, pandemic risk, and climate change risk. [17:43] Akihiro says we need not only risk management but also resilience management. Their presentation will focus first on the energy supply side and demand side. They will show energy resilience scoring to help insurers, bankers, and funders. [19:05] Hirotaka Mitsui explains the Five Ds of Japanese energy resilience management are Depopulation, Deregulation, Decentralization, Digital transformation, and Decarbonization. This is the thesis of their presentation. Japanese government and corporations are looking for new markets to invest in energy resilience. [20:29] Kentaro Hayashi is very excited to be at RISKWORLD! He has been a risk professional for one year. [21:23] Justin wishes Akihiro Kimura, Hirotaka Mitsui, and Kentaro Hayashi lots of luck at their studio session and to have a great experience at RISKWORLD; he hopes to see them again next year in San Diego.  [21:39] Justin says a “special thanks to all of my guests” and all of the RIMS staff for hosting yet another fantastic RISKWORLD! Mark your calendars now for RISKWORLD 2024, May 5th‒9th in San Diego, California. We can’t wait to see you there! [22:00] Sponsor a RIMScast episode to reach a global audience! Justin shares other RIMS offers, including a transitional membership!   Mentioned in this Episode: Mark Your Calendars! RISKWORLD 2024 will be in San Diego, May 5‒9. RIMS Canada 2023 — Sept. 11‒14 in Ottawa! Submit an educational session. RIMS Diversity Equity & Inclusion page Spencer Educational Foundation — Risk Manager on Campus Contribute to Risk Management Magazine RIMS Risk Management Magazine: Awards Edition 2023 Upcoming Webinars: “The Green Transition” | Sponsored by Beazley | May 9, 2023 “Unraveling the White-Collar Criminal: A Comprehensive Look at the Forces Driving Organized Insurance Fraud” | Sponsored by Travelers | May 11, 2023 “Harness The Power of Data for Better Insurance Outcomes” | Sponsored by TÜV SÜD | May 18, 2023 See the full calendar of RIMS Virtual Workshops Related RIMScast Episodes: “RIMS 2023 Risk Manager of the Year Theresa Severson” “RIMS 2023 Rising Star Emily Bloedel” “Riskworld Keynote Johnny C. Taylor, Jr., SHRM President and CEO” (2023) “Innovation and Improvisation with RISKWORLD Keynote Josh Linkner” (2023) “Celebrating #SpencerDay and Funding the Future of Risk Management” “Strategic Moves with RIMS CEO Gary LaBranche” “RIMS President Jennifer Santiago: R.E.A.D.Y. for 2023” “ERM in Banking & Finance with Eleni Willis” Sponsored RIMScast Episodes: The Importance of Disaster Planning Relationships | Sponsored by ServiceMaster (NEW!) Technology, Media and Telecom Solutions in 2023 | Sponsored by Allianz (NEW!) Analytics in Action | Sponsored by Alliant Captive Market Outlook and Industry Insights | Sponsored by AXA XL “Using M&A Insurance: The How and Why” | Sponsored by Prudent Insurance Brokers Ltd.  “Zurich’s Construction Sustainability Outlook for 2023” “Aon’s 2022 Atlantic Hurricane Season Overview” “ESG Through the Risk Lens” | Sponsored by Riskonnect “A Look at the Cyber Insurance Market” | Sponsored by AXA XL “How to Reduce Lithium-Ion Battery Fire Risks” | Sponsored by TÜV SÜD “Managing Global Geopolitical Risk in 2022 and Beyond” | Sponsored by AXA XL “Keeping Subcontractors Safe Through Partner Elevation” | Sponsored by Highwire “ESG: A Responsibility and a Growing Megatrend” | Sponsored by Prudent Insurance Brokers Ltd. “Prioritizing People: Focusing on Your Team to Deliver Exceptional Quality and Service to Your Clients” | Sponsored by Gallagher Bassett “Bermuda Opportunities in 2022 with BDA Chair Stephen Weinstein” | Sponsored by Bermuda Business Development Agency “SyncR: A Tool to Enhance Your Risk Quality & Insurance Strategy” | Sponsored by Prudent Insurance Brokers Ltd. “RIMScast: Navigating the Risk Landscape in 2022” | Sponsored by AXA XL “RIMScast: Prioritizing People: Expertise and Innovation” | Sponsored by Gallagher Bassett “RIMScast: Risk Findings for the Industrial & Manufacturing Industry” | Sponsored by Aon RIMS Publications, Content, and Links: RIMS Membership — Whether you are a new member or need to transition, be a part of the global risk management community! RIMS Virtual Workshops On-Demand Webinars RIMS Advisory Services — Ask a Peer Risk Management Magazine Risk Management Monitor RIMS Risk Leaders Series RIMS-Certified Risk Management Professional (RIMS-CRMP) RIMS-CRMP Stories — New interview featuring Broward County RIMS President Stacey Nielsen! Spencer Educational Foundation RIMS DEI Council RIMS Path to the Boardroom RIMS Events, Education, and Services: RIMS Risk Maturity Model® RIMS Events App Apple | Google Play NEW FOR MEMBERS! RIMS Mobile App RIMS Buyers Guide Dan Kugler Risk Manager on Campus Grant Sponsor RIMScast: Contact sales@rims.org or pd@rims.org for more information.   Want to Learn More? Keep up with the podcast on RIMS.org and listen on iTunes. Have a question or suggestion? Email: Content@rims.org.   Join the Conversation! Follow @RIMSorg on Facebook, Twitter, and LinkedIn.   Follow up with Our Guests:   Paul Larson President, Financial Lines, Liberty Mutual   Alexander Walton National Director of Client Development, Blueteam   Akihiro Kimura General Manager, The Institute of Energy Economics, JapanHirotaka Mitsui Research Fellow, Central Research Institute of Electric Power Industry, Japan Kentaro Hayashi Senior Researcher, The Institute of Energy Economics, Japan   Tweetables (For Social Media Use):   “I’m hesitant to call it a banking crisis just yet. There are certain areas of concern. … We don’t have a significant credit issue. … Will the interest rate risk become a credit risk?.” — Paul Larson   “Our [Blueteam] proprietary software allows us to alert customers, ... for hurricanes, earthquakes, fires, freeze warnings, and wind warnings. So our technology allows us to get them on track faster, prepared faster, and able to take evasive measures faster.” — Alexander Walton   “We call it the five Ds; That’s Depopulation, Deregulation, Decentralization, Digital transformation, and Decarbonization.” — Hirotaka Mitsui