The Gray Rhinos Series is designed to raise awareness about a select group of insurance industry challenges before a major event occurs. We're increasingly hearing from cedants — as well as reinsurers — about the inherently elevated risk landscape we're operating in. In an increasingly volatile world, the ability to quickly identify and prepare for high-impact eventualities is a business imperative for us and our carrier partners.
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.
This Gray Rhino article tackles demographics and long-term care. The need to spend increasing sums on long-term care (LTC) for the elderly is a growing global challenge. By 2070, EU countries are projected to spend an additional EUR140 billion annually, and in the US, LTC spending is expected to rise from 1% of GDP in 2010 to 3% by 2050, with at least half of elderly Americans requiring LTC at some point. The (re) insurance industry is uniquely positioned to help address these challenges by offering solutions to manage the financial risks. Read our report to learn more.
