Gallagher Re’s Gray Rhinos is a series of articles discussing highly probable, high-impact industry events and challenges. The term “Gray Rhino” was first coined by Michele Wucker, an American policy analyst specializing in the world economy and crisis anticipation. In her 2019 TED talk, “Why we ignore obvious problems — and how to act on them”, she urged viewers to replace the idea of the "black swan" (a rare, unforeseeable, unavoidable catastrophe) with the reality of the "gray rhino" — a preventable danger that we choose to ignore.
Gray Rhinos are threats that we can see and acknowledge, yet do little about. Created originally for discussion around large policy issues, the term has become increasingly adopted by the business world — particularly when considering business process, systemic decision-making or industry trends.
When it comes to gray rhino events, businesses often stagnate on a “muddling” stage: Acknowledging that there's some risk of the event occurring but finding reasons not to take any action. With this series, we can provide clients with the tools to address these events head-on: Actively planning for an event, analyzing the scope of the problem and asking what it might take to fix it.
In this article, we explore climate litigation, an increasing risk as activists target companies as well as governments for their failures to address their contributions to climate change.
An increasingly broad range of insurance clients are seeing their risk profiles altered as a small but growing number of cases have — or could — set important legal precedents that make companies and their directors liable for climate-related harms or failures of disclosure. Insurers are exposed where companies have policies that cover them against litigation costs and risks.
As addressed in this article, entire portfolios of insurance business may have to be reviewed considering climate campaigners’ expansion of their legal ambitions, and the risks of such legal action increasing as global temperatures rise. Can (re)insurers manage such future risk?
View the article to learn how.
