Leading accountant and consultant Moore Stephens has urged insurance underwriters
and brokers to make greater use of financial and actuarial
consultancy to assess risk.
John Harbor, head of the Moore Stephens Insurance
Industry Group, writing in the Group's newsletter, insured interest, says, "The events of September 11 in the United States have
shaken the international insurance industry to its
foundations. Now is not a time for being wise after the event. But the terrorist attacks should have scotched once and for all the notion that
insurance can de designed and sold on price alone.
"The best insurance is a combination of commercial acuity, actuarial perception, technical awareness, intuition and luck. Many underwriters and brokers make use of financial and actuarial consultancy to assess risk. Many
don't. Today, those services are more valuable than at any time in history and the good news is that software tools today facilitate the ability to analyze data in ways that were simply not feasible in the past.
"Underwriting in ignorance of the true nature of risk and of potential and aggregate liabilities can no longer be considered a viable option. The
buyers of insurance will have to accept that there may be a higher price to pay for this in terms of risk analysis. "