Financial Institutions face a myriad of risk management concerns that include global and local economic issues, regulatory compliance, employee misconduct, executive liability issues and the rise in technology system attacks.
Whether you own or operate a commercial bank, credit union, investment bank, private equity fund, mortgage company or consumer finance operation, you need good risk management expertise in place. There are insurers available with a focus on delivering you positive financial solutions while navigating this complex and evolving industry.
The finance industry must pay close attention to every new innovation with a capability of disrupting their market, along with new legislation that will almost certainly affect their sector and the customers they serve. There are many new developments that will affect the economy and financial institutions insurance will effectively provide answers to many of the issues that could be coming your way.
Technology is a blessing and a curse
Emerging technology such as Fin Tech, while offering innovative ways and products to sell to consumers, may also be quite disruptive to the market. These products are focused on being user friendly, saving time and delivering a more personalized experience. In today’s world, consumers are increasingly demanding and want instant results.
We’ve come to realize, however, that as financial institutions continue to collect even greater amounts of personal data from customers, they face more cyber security issues and challenges. Banks and financial institutions are likely to face more risks than any other industries. In fact, Info security Magazine reported that financial services firms are about 300 times more likely to be hit by security incidents compared with other industries.
With data breaches now a common concern, there’s pressure for financial institutions to take added steps to protect their data. The need for more stringent consumer privacy continues to increase exponentially. Institutions should constantly be evaluating their internal cyber security policies and implementing best practices to mitigate risks from any potential breaches. This should include offering identity protection services as a show of their commitment to protecting their customers’ data.
While cyber hacks and fraud continue to be a high-level priority issue, institutions can benefit greatly from using new sources of data and analytics to identify potential new customers, help prevent fraud, and better address customer needs with relevant, value added services. Having financial institutions insurance is a key to your continued battle against these costly invasions.