The UK FSA has published the ‘Insurance Resilience Benchmarking Report’ which aims to provide an initial assessment of how prepared the UK insurance sector is for disruptions.  The report is based on a survey which addressed three main questions:

• How resilient would the insurance sector be if faced with a major operational disruption?
• How quickly could it recover?
• What needs to be done to improve its resilience?

Recommendations in the report include:

• Firms should review whether their current recovery capability for critical processes is consistent with their business obligations.
• Firms must ensure they regularly carry out detailed risk assessments and impact assessments, taking into account the nature and complexity of the firm’s business.
• Firms need to collaborate with third parties (e.g. service providers, neighbouring businesses, emergency services and local authorities) especially regarding planning and testing.
• Firms that outsource critical activities must ensure they include formal business continuity requirements in contracts to oversee suppliers’ continuity arrangements.
• Firms relying heavily on third party providers of business continuity sites should consider how they would be affected if there was a multiple invocation of syndicated space. They must ensure their arrangements are transparent.
• Firms should ensure they have robust vetting procedures on all personnel, including contractors.
• Sufficient funds need to be available to the crisis management team to allow it to meet all its objectives.