AIG CEO and President Peter Zaffino says the insurance sector has not addressed emerging risks and climate change quickly enough, and cyber risk is also particularly concerning.

Mr Zaffino made the comments during a fireside chat hosted by Aon CEO Greg Case as part of its Virtual Reinsurance Renewal Season.

“You’re starting to see more ransomware, more frequency, but the big systemic risk hasn’t happened yet,” he said. “That’s something I do worry about.”

Mr Zaffino questioned whether cyber is “an aggregated risk that the industry can actually underwrite effectively to provide value to clients”.

“Is enough capital in the reinsurance industry to actually help mitigate some of that loss, and are there enough active players that can actually be creative at solving client problems?”

While the COVID pandemic has presented new opportunities for innovative insurance solutions, the insurance sector isn’t addressing emerging risks and climate change quickly enough, he says.

Over the past 50 years, economic loss was growing much greater than insurable loss, partly “because the insurance industry as a whole has not addressed emerging risks fast enough,” Mr Zaffino said.

“That is probably more on the capital side than on the broker side – because the innovation that happens on the broker side is much more than on the underwriting side – but there is more work to be done there in terms of solving risk issues for our clients as they think about emerging risk issues, particularly in climate and all the things that are coming. The momentum feels real.”

Lloyd’s of London CEO John Neal will deliver a fireside chat on Tuesday, while Zurich CEO Asia Pacific Tulsi Naidu presents on November 10.