Investment firms need stronger risk-insurance alignment in 2025: WTW

Understanding how policies respond to different scenarios is key to effective risk management.

Investment firms need to align risk to insurance as they continue to navigate digital transformation challenges in 2025, according to WTW.

This may be accomplished through a diligent process, ensuring an organisation’s vulnerabilities are identified and adequately covered.

Trusted data sources will play a crucial role in understanding current risks and emerging trends, as well as in analysing both qualitative and quantitative aspects of exposure.

WTW said that an optimal insurance structure should reflect business needs, risk appetite, and cost considerations. Whilst not all risks are insurable, understanding how policies respond to different scenarios is key to effective risk management.

“As well as identifying key business risks, it is important to fully calibrate the potential financial impacts of the risk exposures you have across the business,” said Richard Langdon, WTW’s FINEX Financial Institutions Wealth & Asset Management Sector lead.

“Using risk models built around industry-specific historical claims data to inform these decisions is an effective way of building your risk management framework around the actual risks present,” Langdon added.