It was an honour to be asked by PACICC (Property and Casualty Insurance Compensation Corporation) to write this paper. Although geared to insurer boards, this paper will benefit all directors and officers who wish to avoid “Collapses” at their organizations. We define “Collapse” as a material adverse impact to stakeholders, such as shareholders, bondholders, employees, pensioners and regulators. We analyze two types of collapse scenarios: A) Insolvencies and Wind-ups; B) +20% public company share price drops (from market reaction to corporate mistakes rather than from stock market volatility). With both, we provide high-level observations on risk governance missteps. Last, we offer eight actions to guide boards in governance and oversight of the many risks which can lead to collapse.
Insurer “Collapse”: Learnings for P&C Boards
