Canada’s P&C industry behind other sectors in establishment of CROs

Canada’s property and casualty industry has been lagging in the establishment of the Chief Risk Officer position, and the processes that accompany it, Julie Dickson, the superintendent of financial institutions, said.
Dickson spoke at OSFI’s first risk management seminar for the p&c industry on Nov. 5 in Toronto.
“While the p&c industry has perhaps been ahead of the other sectors in the management of specific risks, the establishment of the CRO position, and the processes that accompany it, which allow for quicker assessment of risk across an entire organization, have been slower to develop in the p&c industry to date,” she said.
The concept of risk management is not new, she acknowledged, and the p&c industry has many inherent known risks — such as being highly price competitive, prone to cycles where at times pricing can be too low to cover claims, and having some business lines where pricing and claims payment terms are highly regulated.
“OSFI recognizes that the p&c industry has a diversity of institutions in terms of their size, number and complexity of business lines, risk appetite, etc., and that all of these factors will logically lead to different requirements with respect to the robustness of the risk management program,” she continued.
“However, I cannot overemphasize the importance of having an organization-wide risk management in place to help manage the numerous known, unknown and emerging risks that p&c institutions face in these challenging times.”