Skies are safer but aviation industry faces challenges
A new report from Allianz says that although the skies are safer there are significant challenges for the aviation sector. The study shows that over the past 60 years skies have become much safer. Today, it is estimated there is more chance of being killed by lightning (1 in 10.5 million) than dying in a plane crash in the US and Europe (1 in 29 million). This is despite growth in the sector which will see an estimated 3.3 billion passengers fly this year compared with just 106 million in 1960. However the cost of aviation claims is rising, driven by the widespread use of new materials in plane design, as well as ever-more demanding regulation and growth of liability-based litigation. Increasing fleet values and a rise in passenger numbers is expected to push the value of risk exposure through the $1 trillion barrier by 2020, possibly even earlier. While North America and Europe have the best safety record, Africa and Asia fare less well. Africa had 45 per cent of the world’s air fatalities in 2012, Asia had 43 per cent. Use of older aircraft is one of the main reasons. Going forward challenges for the aviation industry include the increased use of unmanned aircraft, or ‘drones’; currently restricted or banned for commercial use in many jurisdictions but that is expected to change in the coming years. Read the full report.
Insurance industry needs to form partnerships to tackle underinsurance
The insurance industry needs to work with governments and other service providers to tackle the issue of under insurance. A new report from the think tank The Geneva Association says that while emerging economies are increasing their share of global GDP; to around 40 per cent currently; their share of global insurance policy premiums is just 17 per cent. This means large gaps in insurance cover in those countries but there are also gaps in developed economies too. Of the range of issues that underinsurance creates for the industry, the report warns that where private sector insurance is not prevalent it could lead to scepticism as to whether it is valuable. Although the bulk of underinsurance is in emerging economies, Hong Kong and Saudi Arabia have also been identified as being underinsured. The causes of underinsurance are also examined in the report and include; historical protection by the state rather than private sector; cost of premiums; and cultural or religious opposition to insurance. Read the full report.
Most companies are under cyber attack
There’s been a lot of talk about the high-profile cyber attack on Sony Pictures recently; the latest development being a denial by North Korea that they had anything to do with it. This one may be a headline-grabber but cyber security firm Malwarebytes says that 83 per cent of companies in the US have been victims of some sort of online threat with 46 per cent facing three or more. A survey of IT decision makers from across a wide range of sectors found that vulnerabilities in web browers was the biggest single issue. Data theft was not the biggest result of an attack, neither was financial loss; the drain on IT resources was considered the number 1 issue with teams being diverted away from other jobs.