To control and have methods to offset market risk is tough and complex. Fund managers cannot always fully estimate the impact of the market risk on their portfolios. 9/11 was an event that no one had ever envisaged. Yet, it happened, forever changing the way risk was viewed.
Tim East, the Director of Corporate Risk Management Services at The Walt Disney Co. says “First, 9/11 has made all of us more aware of the need to consider risks and exposures we’ve never considered before—to evaluate risk more broadly and to include the cascade effect of multiple events occurring at the same time.
Second, the resulting coverage and form dispute following 9/11 made it clear that risk managers, brokers and insurers need to get the terms, language and conditions communicated clearly and acknowledged by all parties.
Dan Kugler, the Assistant Treasurer, Risk Management at Snap-on Inc., while speaking about 9/11 opines, “From a risk-manager’s perspective, the events of 9/11 made me expand my view of “what can happen” and the resulting consequences—highlighting the need to expand our view of potential loss and the need to fully support and work closely with local officials in coordination of catastrophic losses.”