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The 14th annual Excellence in Risk Management report finds an apparent lack of awareness among many risk professionals on existing and emerging technologies including telematics, sensors, the Internet of Things (IoT), smart buildings and robotics, and their associated risks.

According to the survey report by Marsh and the risk management society, RIMS, when presented with 13 common disruptive technologies, 24 percent of the respondents said their organizations did not currently use or plan to use any of them. The authors find this surprising, considering other studies have found more than 90 percent of companies either using or evaluating IoT technology or wearable technologies.

The report also found that despite the impact disruptive technology can have on an organization’s business strategy, model, and risk profile, a majority of respondents — 60 percent— said they do not conduct risk assessments around disruptive technologies.

“Today’s disruptive technologies will soon be — and in many cases already are — the norm for doing business,” said Brian Elowe, Marsh’s U.S. client executive leader and co-author of the report. “Such lack of understanding and attention being paid to the risks is alarming. Organizations cannot fully realize the rewards of using today’s innovative technology if the risks are not fully understood and managed.”

The authors see all of this as an opportunity for risk professionals to close the gap when it comes to understanding and managing disruptive technology risks. But it means risk managers must be willing to play a leading role as their organizations address complex challenges in this environment. Previous Excellence studies have shown that C-suite executives and boards of directors want to know what risks loom ahead for their organizations and are increasingly relying on risk professionals to provide that insight.

“As organizations adapt to innovative technologies, risk professionals have the opportunity to lead the way in developing risk management capabilities and bringing insights to bear on business strategy decisions,” said Carol Fox, vice president, strategic initiatives for RIMS and co-author of the report. “As a first step, risk professionals are advised to proactively educate themselves about disruptive technologies, including what is already in use at their organizations, what technologies may be on the horizon, and the respective risks and rewards of using such technology.”

The Excellence survey, “Ready or Not, Disruption is Here,” is based on more than 700 responses to an online survey and a series of focus groups with leading risk executives in January and February 2017. Findings from the survey were released at the RIMS 2017 Annual Conference & Exhibition in Philadelphia.

Topics InsurTech Tech