We live in a time when risks do not exist in isolation. They overlap, one grows and create consequences that no single industry – or even country – can manage by itself. The last Kennedys global forecast Make this clear: cyber attacks, extreme weather conditions and geopolitical instability are not distinct threats but facets of intertwined and intertwined polycrisy. The supply chains are at the heart of this storm.
Take marine logistics. The report calls cyber attacks as the most immediate danger. Ports, maritime companies and freight management systems are increasingly targeted by pirates. A single breach can provide vital supply routes to a complete dead point, leaving manufacturers without parts and supermarkets without stock. However, cyber-men are just one piece of the puzzle: extreme weather and political tensions flock to other directions. The drought of the Panama canal has already reduced the shipping capacity, forcing ships to take longer and more expensive roads. Geopolitical tensions do the same. The Red Sea, formerly a critical artery of world trade, has become a high -risk area. Some ships now travel instead of Africa. This means thousands of kilometers of additional navigation, increasing costs and delaying deliveries. If a major cyber attack was to strike a key port in the middle of such a turmoil, the disturbance would unfold out of control.
It is tempting to deal with these problems as separate problems, to believe that repairing a strain. But it is a vow pile. In polycrisy, the old way to manage the risk – realizing with each threat in isolation – does not work. Climatic disasters oblige populations to migrate, which increases political instability, which can cause economic volatility or outright conflicts, weaken governments, disturb the supply chains and make regions more prone to cybercrime … These forces are mutually strengthening, creating treatment effects that traditional risk models have trouble anticipating. Insurers, companies and political decision -makers must face this new reality.
The good news is that, more and more, they are. The insurance sector, long considered as a safety net there to pick up the parts when the disaster strikes, intensifies and becomes a more complete version of itself. Aware that we cannot just cover losses – that we have to help companies and communities to anticipate and mitigate risks before degenerating – we invest in prevention.
The technology, from observation of the earth to sophisticated cybersecurity tools, is one of the most powerful means of doing so. Take the first. The satellite imagery combined with AI -oriented analyzes allows insurers to follow the vulnerabilities of the supply chain in real time. We can monitor the congestion of ports and predict extreme weather events before hitting. This technology is already helping sea companies to assess political costs and risks. In the near future, we can go further. Companies will receive live information on the precise risks of their supply chains. This will allow them to act before the deployment of the disaster.
And action is the keyword here. The climate crisis aggravates (indeed, the warning of Petra Hielkema, responsible for the best European insurance regulator, that the continent cannot face the increase in extreme time costs was austere). There are serious geopolitical disorders. Cybercrime is better and better day by day, moving largely in darkness and out of sight, being known until there is a breach. If we count on obsolete models, our supply chains will remain seriously at risk. Prevention -based insurance, which uses real -time data to help companies and individuals to protect themselves before strikes in the event of a disaster, is the only sustainable route.
Some maintain that insurance focused on prevention is expensive, that the required technology is expensive and complex. But the cost of doing nothing is higher. The European Investment Bank estimates that every € 1 (USD 1.13) spent on prevention saves 5 to 7 € ($ 5.63 to $ 7.98) in recovery costs – the economic case is clear. But there is also a human case that will be able to make sure that people appreciate the quality of life they are used to enjoying. Advanced and anticipated risk management also prevents loss of life. It operates societies and operates with confidence, in an era of grave and increasing instability.
This change is not a difference in what insurance has always been. It is rather a return. The fundamental purpose of insurance is not only to compensate for the loss. It is to strengthen resilience. It is to empower people and societies that they generate by minimizing disturbances and minimizing damage. It is a question of protecting lives, livelihoods, communities, societies, whole countries.
Insurers are sometimes reluctant to abandon these obsolete models. They adapt. At a time when the disruption of the supply chain cannot be divorced from the other risks that we face today, those of us responsible for protecting these supply chains examine the situation in a holistic manner and the development of holistic solutions. We use the latest technologies to help people withstand shocks that are inevitable in a turbulent world.
About the author
Rostu stone
Pierre du Rostu is CEO of AXA digital commercial platformwhich uses technology to anticipate and proactively protect customers from the risk of supply chain. That’s part of AxaA global insurer.