

“To date, the industry has done an
excellent job of fulfilling our promise
to bring people, businesses and
communities from harmed to whole
after disaster strikes.”
Tony Kuczinski
Former CEO
Munich Re US P&C Cos.
while becoming more innovative, agile, client-
focused and responsive to industry and client
needs.
When I took over as CEO for Munich Re
in the U.S., our business was in a turnaround
scenario, and we were in this turnaround mode
for about the next two years. Most of the business
was reinsurance and, of that reinsurance, our
distribution was predominantly direct. We
intentionally shifted our reinsurance model to be
distribution-channel neutral, which in turn shifted
our business away from the direct channel toward
the broker channel. This was not easy or popular
in the short term—either internally or with the
brokers themselves—but ultimately proved to be
the right decision.
What about the changes in climate and
various catastrophic incidents that have
occurred in recent years?
I look at the role the insurance industry can
play in two distinct ways. First, as individual
companies, we should be responsible corporate
citizens, committed to reducing emissions and
limiting global warming. We have to practice what
we preach. Second, as we not only manage but
also help to prevent and mitigate risk, insurance
companies have to do a better job of speaking
as an industry—raising our collective voice—to
increase understanding of the extreme financial
costs involved in providing post-event coverage for
these rapidly evolving risks.
To date, the industry has done an excellent job
of fulfilling our promise to bring people, businesses
and communities from harmed to whole after
disaster strikes. For the most part, the industry
responds quickly and responsibly to these events.
As an industry, we are currently meeting the
financial obligations when claims are presented,
but I don’t think we have been proactive enough
in adjusting pricing for these increased exposures
or in driving needed change in resiliency around
the globe.
Of course, the insurance industry has a role
to play in preparing for and managing the risks
associated with climate change, but it can’t solve
the problems by itself. No matter what steps we
take as an industry, many other sectors need to be
involved. The insurance industry should be seeking
out various like-minded parties to develop more
public-private partnerships, implement community-
based solutions and generally raise awareness
of the need for rapid, joint action to address the
serious risks posed by climate change.
In terms of infrastructure, specifically,
governments must prioritize this issue in order
to ensure that everything, from roads to dams to
electric power grids, is resilient to climate change
and natural disasters. As governments consider
new spending, enduring resilience should be an
essential component of all such projects.
What do you see as the most crucial
challenges facing the industry and what are
some potential solutions?
Systemic risk and cascading risk, particularly
as they relate to cyber and natural catastrophe
exposures. Many solutions require insurance
companies to work collectively. I think it is
important to acknowledge that ours is a very
competitive business. However, competition
notwithstanding, there are effective ways that we
can respond to some of these issues if we speak as
an industry rather than individual companies.
BR
BEST’S REVIEW • MARCH 2023
31