Insurers are reaching a point where some risks are falling outside the “boundaries of insurability”, according to Zurich Australia Head of Global Corporate Kai Dwyer.

Speaking at the Risk Management Institution of Australasia conference in Sydney last week, he said the role of the risk management community and insurers is becoming increasingly complex as emerging risks grow “on an unanticipated and massive scale”.

“As businesses continue to grow and develop the boundaries of insurability are pushed ever further,” he said. “It means the relevance of the insurance value proposition is constantly tested.

“The reality is, in our progressive world, not all risk scenarios can be affordably transferred to insurers.”

Mr Dwyer says issues like climate change, the complexity and interdependency of supply chains, scientific and technological advancement, investment behaviour, political stability, social awareness and human behaviour changes (such as being increasingly litigious) are pushing the insurability boundaries.

“It is always the case in our industry that our role is to provide assurances of a balanced view of risk versus reward,” he said. “Unfortunately, there is no simple process or solution to stretching the boundaries of insurability. And, we need to ensure our own exposures are managed.”