Bernhard Kaufmann, Munich Re
As Munich Re's group CRO, Bernhard Kaufmann steers a global risk management organisation with several hundred risk management professionals in more than 100 branches and entities. A long-term employee of the group, his experience spans treasury, asset-liability management and the primary insurance sector (he was previously CRO of Ergo, Munich Re's primary insurer). He is also one of the leading voices in the European risk management community, currently vice-chair of the CRO Forum and its designated chairman for 2016.
What do you enjoy most about your role?
I very much enjoy overseeing the variety of risks to which we are exposed globally, especially emerging risks. We not only identify these risks, but also support business units in developing new insurance solutions. A very good example is the field of cyber risks. In summary: I can hardly imagine a more fascinating job than mine.
Who or what has inspired your work?
By training, I am a physicist. The spirit of wanting to explore what is behind an observation and the underlying reasoning has long inspired me.
What are the major challenges ahead?
The biggest challenges for the insurance sector are changes in the political and economic landscape. The current low-interest rate environment in developed economies is only one example. Market shocks will be more likely, and will affect the business and solvency position of the insurance industry.
Another challenge is how risk management can support change and innovation. The disruption of many business models means the re/insurance industry has to develop new solutions to remain relevant. The business models of re/insurers are also under threat and have to be further developed so that the industry does not wane.
What will be the next big development in risk management?
As a consequence of increasing global dependencies and the rapid spread of technological innovations, events that test the limits of traditional scenario-based risk management are occurring more frequently. Both the occurrence of an event and its potential consequences are increasingly difficult to foresee. This will certainly have a major impact on risk management tools and methods in the future. We are currently investigating the field of complex accumulations, and have developed a sophisticated software tool that can make risks and their interaction more transparent – and quantify them, at least in part. But developments in predictive analytics, the use of artificial intelligence techniques and behavioural approaches may also help us to better manage these kind of risks.
What are your other interests?
I have a lot of interests, but – like many others – what I most lack is time. I try to devote most of my free time to my family, and to explore the world. I stay fit with jogging and cycling ... and it is a bit of a risk when your kids start to beat you at tennis and are running up hills more easily than you are, but it is still a lot of fun.