Financial institutions often veer close to financial disaster - sometimes through no fault of their own but because something unanticipated has gone wrong. Intelligent Insurer takes the first of what will be a series of glimpses at the world of operational risk.
Financial institutions don’t like to think about failure. But sadly, there are times when they have to—when risks that they might not have known even existed suddenly appear on the horizon.
With Solvency II now finally arriving and with companies realising that operational risk is something that they will have to look at in some detail because of the new regulatory regime, operational risk insurance is a topic of a lot of discussion.
Operational risk can be defined as the risk of loss resulting from inadequate or failed internal processes, people and systems, or from external events. This definition includes legal risk, but excludes strategic and reputational risk.
Solvency II, Angelos Deftereos, XL Catlin, Europe