What’s permanent and what’s temporary? Intact CEO on navigating geopolitical turmoil

Geopolitics, climate change and technology are the most important trends in the world today, together driving a volatile and riskier world, he said. But also, “when there is adversity, there’s an opportunity.” It is for individuals and businesses to rise to today’s challenges and find new, positive ways forward.

The CEO’s core advice was to distinguish between the noise and the signals. “The big challenge in strategy making is to figure out what is permanent and what is temporary,” he told delegates, “and then make sure your energy goes into what is permanent.”

The new era of higher tariffs is likely to be permanent, he believes. However, while it means lower global growth and higher inflation, the insurance sector is not significantly impacted. “In our industry, for a dollar of cost, there’s about seven cents directly impacted by tariffs…It’s important but manageable.”

While the potential for a major fiscal crisis in the US must be carefully monitored, the US dollar is unlikely to be replaced as the world’s reserve currency, in part because there is no credible alternative, he argued.

However, the biggest issue in the U.S. – and one that has a “degree of permanence” – is the erosion of democratic institutions, he warned. Decision-making is being centralised, the legislative checks and balances have become “rather impotent”, and attacks on the press and courts are concerning, he argued.

Invest in resilience

The importance of investing in resilience was also a key theme of the opening session. There are “staggering” protection gaps for both cyber risk and climate-related risk, he argued. Cyber risk is only growing as “the perpetrators have been more agile at using AI than the defenders”. Meanwhile, global efforts to decarbonise the global economy are “slowing down” on the back of geopolitical headwinds.

As a result, prevention and adaptation – both in relation to cyber and climate risks – are vital in today’s world. Don’t hold back on investment, he warned, and “be prepared for many scenarios.”

Now the largest provider of property and casualty insurance in Canada and a leading provider of global specialty insurance, Intact was launched by Brindamour in the depths of the 2007/8 crash, its CEO said: “I realised there was an opportunity in the financial crisis”.

How does this relate to today? Be ready to seize an opportunity. “Tail risk is up and therefore scenario planning is absolutely fundamental to be ready to react to any change [and] to take advantage of these changes.”

Risk and insurance takeaways:

• On global political turmoil: differentiate the noise from the signals;

• With tail risk up, scenario analysis is vital;

• Large protection gaps in cyber and climate risk mean investing in resilience is important.