Future risk: Social and economic challenges for tomorrow

The world faces a vast array of global economic and political challenges. The financial crisis and euro zone sovereign debt problems, as well as the political paralysis over the US debt ceiling, suggest we are on the verge of a seismic change in the nature of the global economy and international relations.

Similarly, continuing increases in population size and life expectancy, and changes in patterns of migration throw up their own vast array of political headaches and economic trade-offs which need careful management and strong collaborative leadership. Each presents their own set of opportunities and threats, some of which are familiar and some of which are not.

Crucially, the insurance and financial services industry must be one step ahead in order to provide comprehensive insight into the changing nature of these challenges, and to recommend credible courses of action in the face of them. With this in mind and to coincide with our centenary year, over the course of 2012 we are publishing a series of reports which reflect on the great challenges of the past and explore what the future might hold.

In early February we published the first in the centenary series - Future Risk: Learning from History. It set the scene for the CII Future Risk series by reflecting on some of the most dynamic trends of the past and their potential implications as well as discussing some initial findings from a global survey into the risk perceptions of members of the public from across the globe.

A central point made by the report was that in such a rapidly changing international environment, it is vitally important to question underlying assumptions about the world around us and re-evaluate prevailing wisdom. We qualified this statement by noting that whilst a healthy level of scepticism about prevailing wisdom and future forecasting is a good thing, it should not prevent us from developing some scenarios on the long-term to help us prepare for some of the opportunities and risks that lie ahead. Rather, it should ensure that we do not become overly confident and dependent upon any single story. In this context, the second in our series of reports looks at some possible socioeconomic futures and their implications for the insurance sector and society as a whole. Crucially it also seeks to identify what role the industry can play in delivering a more prosperous world. Our next report in the series will look at future environmental risks.