Climate Resilience: How Allianz Evaluates Supply Chains
How does climate risk exposure connect to supply chain decisions, and where does circularity come in?
Michael Bruch, Global Head of Risk Consulting Advisory Services, and Lena Fuldauer, Head of Resilience & Business Development at Allianz Risk Consulting, talk about how companies can assess climate risk across their locations and supply chains, and what role circular strategies play in strengthening supply chain resilience.
What you’ll hear in this episode:
- How companies use location-level climate risk data to spot vulnerabilities within the supply chain and compare potential investment sites.
- Why the most productive conversations happen when risk managers and sustainability teams work together.
- How circular approaches like battery recycling reduce dependence on geopolitically concentrated raw materials.
This episode opens the series Enabling Circularity Through Insurance. The series looks at the concrete levers insurance companies hold, from risk assessment and advisory services to product design and claims policies, and how these can enable circularity.
Video Impression
People
Michael Bruch, Global Head of Risk Consulting Advisory Services at Allianz Commercial
https://www.linkedin.com/in/michael-bruch-30b408114/
Lena Fuldauer, Head of Resilience & Business Development at Allianz Risk Consulting
https://www.linkedin.com/in/lena-fuldauer/
Patrick Hypscher, Circular Business Strategist, PaaS Expert
https://www.linkedin.com/in/hypscher/
Chapters
0:00 Intro
5:28 The Risk Landscape Today
7:52 Learning from Near-Failure
10:45 Rising Catastrophe Losses
12:26 The Insurance Gap
14:21 Hazard, Exposure, Vulnerability
16:34 What is CAReS?
22:56 Circular Supply Chains, Lower Risk
28:26 Location Over Industry
34:47 Finding Allies Inside Companies
38:28 Circularity in Insurance: The Outlook
40:35 Outro
About
Allianz Commercial is the corporate insurance business of Allianz Group, serving mid sized companies, large enterprises and specialist risk clients through insurance solutions designed for complex commercial exposures. It combines global reach with local market expertise and positions itself not only as an insurer, but also as a partner supporting clients through risk management, resilience building and sustainability related transformation.
Allianz Risk Consulting (ARC) provides the technical and advisory side of risk management, helping companies identify, assess and mitigate operational and strategic risks through services such as engineering surveys, risk assessments, loss prevention and technical guidance. In the context of circular economy, Allianz Commercial and Allianz Risk Consulting engage with circular business models as part of broader work on resilience, risk reduction and sustainable value creation, including contributions to the 2024 white paper The Business Case for Circular Economy.
Further Links
Know more about Allianz: https://commercial.allianz.com/services/risk-consulting/cares.html
Transcript
[00:00:00] Intro
Michael Bruch: Being dependent on such an important raw material makes you also dependent in terms of your supply chain and very vulnerable. When you are investing into circular economy like battery recycling, that helps you as well really to get more independent from those supply chains.
Jingle: My name is Patrick Hypscher and this is Circularity.fm, the podcast about understanding, building and managing circular business models.
Patrick Hypscher: Insurance is often seen as a passive player in the economy, but this series explores a very different perspective. Insurance can actively shape how circular business practices scale. Across the conversations, we look at the concrete levers insurance companies hold, from risk assessment and advisory services to product design and claims policies, and how these can enable circularity. The series shows that insurance is not just about covering risk after the fact, but can become a strategic force in driving the demand for circular solutions. And to be honest, these conversations opened new perspectives to me personally. Thanks to our listener Catherine for suggesting this topic a while back. And now let’s get started with our series Enabling Circularity Through Insurance. We begin with a perspective from one of the biggest insurance companies in the world.
Allianz is a major player in the industry and familiar with insuring risks. We don’t directly talk about a classical insurance product yet, we rather look at how Allianz makes climate risk manageable for international companies and how this relates to circularity. If you want to get the key findings for you to reflect on or share it with colleagues, sign up for the Circularity.fm newsletter. Also for a couple of weeks we enhanced it with an outlook on upcoming circularity industry events. You can find it at www.circularity.fm.
Before we continue, I have a new offer for you. You’re probably here because you want to learn, and this is for a reason. Circular economy is more than just a topic, it’s a learning journey. That’s why I’m happy that support for the series comes from the Entlich Academy. Entlich Academy is the first and only German language online academy completely focused on circular economy. Do you want to get a first overview about circularity? Then check out the Starter course. Do you want to know more and apply the knowledge in your daily business? Then the Circular Economy Explorer is perfect for you. You are a sustainability manager, consultant or trainer? Then the Circular Economy Pioneer course gives you the comprehensive know-how you need to succeed in your role. And here is the best part. Circularity.fm listeners get 25% off with our code circularityfm25. Visit Entlich.co/academy and add circularityfm25 as the discount code. This is circularityfm25 in one word. You’ll find the link to the Entlich Academy in the show notes.
She studied environmental change and management. She holds a PhD from University of Oxford in Climate Adaptation for Sustainable Development. She worked with United Nations agencies and since more than three years for Allianz. Right now she’s the head of resilience and business development at Allianz Risk Consulting. Welcome, Lena.
Lena Fuldauer: Welcome. Thank you, Patrick.
Patrick Hypscher: He studied environmental engineering in Berlin. After working for Linde, he joined Allianz. For more than 20 years, he had several positions. Since 2022, he is global head of risk consulting advisory services at Allianz Commercial. Welcome, Michael.
Michael Bruch: Welcome, Patrick. Thanks for having me.
Patrick Hypscher: Michael, Lena, what personal risks did you take last week?
Lena Fuldauer: Well, I think my personal risk was probably my trail run, so I love being out in the mountains and jumping over bits and pieces, especially as the leaves were falling and I went down quite a lot faster than I went up. So I think that was probably the biggest risk I took last week.
Patrick Hypscher: OK. And Michael, what about you?
Michael Bruch: Yeah, I travelled to Düsseldorf and held a presentation on CAReS, which was not really a risk, but it’s always a little bit out of the comfort zone because you don’t know what kind of questions you get, what kind of people you meet. But overall I think it was really a very nice conversation, presentation and I met very interesting people. So it was a personal development, not a huge risk, definitely not.
[00:05:28] The Risk Landscape Today
Patrick Hypscher: OK, so quite some reward also combined with that. Nice. Let’s zoom out, because you’re, you’re experts on sustainability and risk, of course. How do you see the risk landscape changing these days?
Michael Bruch: Yeah, I would say especially in 2025, it’s, it’s really a kind of convergence of geopolitical, economic, environmental, technology and societal challenges. I mean, when you think about the geopolitical instability such as in Ukraine or the Middle East, when you take economic uncertainty in depth, which is a huge concern. Then of course what we will talk today as well about the environmental and climate risks. So take the extreme weather events, biodiversity loss or and ecosystem collapse, really top long-term risks. And climate change is not only a direct threat, but also we see that as a multiplier of other risks such as food insecurity, migration and political instability. So the list, I could go on and on, but it’s really this combination of many different risk topics interconnected to each other.
Patrick Hypscher: You have a view of how risk develops. Is it just a feeling or do you also observe an increase in risk?
Michael Bruch: I would say the, the kind of risk landscapes changes, but the traditional way of ensuring those risks is of course a kind of base load. I would describe it like that. So you have the typical kind of insurable risk like property damage, business interruption, you have the liability, casualty, risk landscape. But within those buckets you see a lot of changes and interconnections between those risks. I would describe a systemic risk and make to make it very concrete, take the climate change topic and the chronic risk like droughts or water scarcity. Normally not really what you can ensure, because when you take for example those risks, they normally don’t trigger physical damage, which is usually in the insurance space, a kind of trigger element before you can ensure business interruption in a traditional way.
[00:07:52] Learning from Near-Failure
Lena Fuldauer: And I think we’ve also, at least as an insurance industry, really learnt to master that more, let’s say predictable unpredictability. So there’s always been risks. And if we look back, especially looking at natural catastrophes, as Michael mentioned in the 1980s, 1990s, when we had a number of hurricanes, it is really when they learned how to deal with that unpredictability and not only price for what has been there in the past, but use catastrophe risk modeling, for example, to also understand how what what could happen in the future, is that now when we look at how the industry can deal with such uncertainty, they’re actually better placed now than they were 30-40 years ago.
Patrick Hypscher: That’s good news. I mean, insurance seems to be a risky business, but at least the insurance industry is learning.
Michael Bruch: I would subscribe to that.
Patrick Hypscher: I want to ask how are companies affected, but it, it feels like a silly question because I, I don’t know if there’s a pattern to what you just described. So is there, like if we look at the last 5 to 10 years, are there special highlights when it comes to the effects of these [UNCLEAR] on companies?
Michael Bruch: Yeah, definitely. I mean, especially when you look to the last five years, like the pandemic for example, it was a huge impact on the whole global society and the economy. So everyone could feel it. And especially the global economy was heavily impacted when you take tourism or other main industry segments heavily impacted by such an event.
And of course, insurance plays an important role when it comes to such events. But it can only kind of, especially with those kind of events which hit almost the whole world at the same time, insurance can not mitigate all those risks or cover those risks. That would be simply not possible in terms of coverage solutions.
But that makes it even more important to invest into resilience measures and loss prevention measures, really being prepared for such events, having the crisis management in place, having kind of bottleneck suppliers identified and, and, and backup suppliers in place. So really I think that, that’s a big learning as well from the last years that you need to think about those scenarios, what could happen and then to invest into the right mitigation measures.
[00:10:45] Rising Catastrophe Losses
Patrick Hypscher: If we now zoom into climate and natural catastrophe events, how did they change the insurance products, if they changed insurance products at all?
Lena Fuldauer: I think what we’re seeing much more in the industry now is, is really a shift to become much more partners in resilience. So not only being a risk carrier, but really moving to supporting clients to better understand natural catastrophes, but also to be proactive and support them to take resilience measures because we’re clearly seeing that trend.
It’s around 5 to 7% yearly increase in natural catastrophe losses over time that have been insured. And that trend is driven mainly by socioeconomic factors. So that is urbanization, economic growth, inflation, etcetera. But of course especially for some perils, there is also already a climate change aspect to that.
And then when we especially look into the, into the future for certain perils like floods, but also heat waves, we do see already a clear evidence of that, of the climate change signal. So we are seeing from our clients also an interest much more in understanding natural catastrophes and in asking us on how we can support them to reduce their risk to these different perils.
[00:12:26] The Insurance Gap
Michael Bruch: And on top of that, I would say that there was, is and was always an insurance gap, so kind of losses which haven’t been covered by insurance. This gap is also increasing especially when you look to climate change driven natural catastrophes in those areas like, like droughts for example, heat waves and so on. There, there’s of course a huge area which is not insured, but also kind of highly exposed areas. Take the wildfire in California this year, it becomes even more difficult to get insurance for those areas which are highly exposed to those kind of risks. So therefore that, that, let’s say emphasizes the importance to invest really in, in resilience measures.
Patrick Hypscher: Is the chain of causality that we have an increase of catastrophes that drives the damage, that drives then also the price for new insurance or even that the absence of some insurance products is just, let’s say, main causality right now?
Michael Bruch: I mean the main drivers as of now, we have to say that will definitely change over the near future. And the main drivers are really the kind of higher values in, in highly exposed and nat cat prone areas. And the climate change driven element is of course plays a role, but not a significant role compared to the assets which are exposed in those areas.
Patrick Hypscher: OK. And, and is, do, is this still related? So the climate change and the exposed assets?
[00:14:21] Hazard, Exposure, Vulnerability
Lena Fuldauer: Maybe I can jump in here in the sense of taking a step back almost on what the IPCC, so the International Panel on Climate Change tells us in terms of how they look at risks. So usually they define risk as being the product of hazard, exposure and vulnerability. And hazard is the aspect that changes with climate change for certain perils and for certain perils we have more evidence than for others. Most evidence we certainly have for heat waves, droughts, but also extreme temperature on things like severe convective storms, for example, that is highly dependent on the region, where for example, in, in, in the US on, on tornadoes, we just don’t have enough data yet to have a clear signal. Whereas for hail, for example, in Europe, we already have evidence that we’re seeing increasing hail intensity.
So this is the first aspect is, is, is the hazard aspect which we have that climate change link. The second then is on the exposure. So this is really where we build and this has been, is really decisions that we make independent of, of the climate. What about incentives in terms of where to live? Are we building, rebuilding back after extreme weather events in areas that we know are highly exposed to certain hazards?
And then the third aspect is around the vulnerability. So that’s really how we build. What kind of building materials do we use and how are we using, for example, flood proof doors? Can we build in a different way to be more storm resilient, to be more hail resilient, etcetera?
So I think this is a helpful means to understand where does climate change play a role, what do we already know, but also what are decisions that we can make absolutely independent of climate, which we know now are critical to help reduce vulnerability and exposure.
[00:16:34] What is CAReS?
Patrick Hypscher: OK, gotcha. And, is, I learned from Michael that last week he travelled to Düsseldorf and presented CAReS. You started this year, in 2025 with CAReS. Can you tell us a bit more, what is CAReS?
Michael Bruch: Yeah, CAReS is a combination of a tool we are offering to our clients in Allianz Commercial, but not only to our existing clients, but also to new clients and even Allianz entities are highly interested in, in, in such a service. So it’s a combination of a tool which gives you an overview of, of your locations and what is going to happen with those locations currently in terms of nat cat, nat cat, let’s say activity, the natural hazards, and what’s going to happen over the next decades. So we have, we have kind of scenarios for the next decades 2030, 2050, 2080, and those are then related to different IPCC scenarios, so climate change scenarios we are expecting over the next years.
So the tool element gives the client an overview, what’s my portfolio, how does my portfolio look like and what kind of locations are higher exposed to those scenarios and events in the upcoming future. Beside that, we, because that was also a clear client demand, so we have co-developed this, this tool together with clients, which was to us and I think for our clients as well a very good learning because you can, I mean, you can include multiple features into such a tool, but it must bring really a value, value add to the client. So what we have seen is that they were asking as well, it’s nice to see what is my high priority, highly exposed location, but I want to get a solution as well or recommendations how to deal with those exposures and, and risks.
So therefore, on top of those, such a tool, we are offering also a dedicated risk engineering service. That means that if we identify, for example, a highly exposed location exposed to flood, we are offering to send an engineer to the location and then really doing an in-depth assessment, detailed assessment, and to come up with a recommendation how to protect such a location.
Patrick Hypscher: So it’s actually like a service, as you said, and not an insurance covering the risk.
Michael Bruch: Right. It’s a combination. It’s, it’s a kind of service our clients can get as a bundle service. That means it’s part of the insurance solution, but they can also get such a service. So the tool plus the dedicated engineering service as an unbundled service. So there’s no need for having an insurance solution in place. It’s really a service which can be used because that was a request from clients as well, to have the two options as part of the insurance solution or as an unbundled solution.
Patrick Hypscher: And can you elaborate a bit more on the assets you, your focus there? So are these production sites or the, the office buildings or so what, what kind of assets are you looking at?
Lena Fuldauer: So clients can really upload whatever type of asset they would like to see, so if they wish to buy it as part of our insurance contract, so if they already part our clients, we would automatically upload all of the locations that we already have insured with the client. But the client is then free to upload any additional sites that they would like to have an understanding on.
So what we have seen particularly interest around is, is around suppliers. So often our clients have 1, 2, 3 particular suppliers which are highly important and highly critical for them. So they would then upload that location. The other aspect that they often interested in is around new investments. So really using CAReS to support with the due diligence of a, of a new investment. They say they have three, 4-5 different potential locations that they might invest in, say in production facility. They would then use CAReS to understand how does climate change affect intensity, frequency of various natural catastrophes and can then compare these sites to, to better inform the investment decision.
Patrick Hypscher: And what are the kind of events or risks that are covered in this tool?
Lena Fuldauer: So we cover both acute and chronic risks. So under acute that is floods, for example hail, tropical cyclone. Chronic involves extreme temperature days, so days above 35 degrees of temperature, days above 40 degrees of temperature, but also longer term changes in precipitation for example.
Patrick Hypscher: Insurance companies help to mitigate risks, so do circular practices. If you want to build your circular economy knowledge and de-risk your company’s business, check out our partner Entlich Academy. The Starter course gives a first overview. The Explorer course provides helpful knowledge to switch from linear to circular practices. And the Pioneer course provides academic content, 70 case studies and more than 100 infographics. Circularity.fm listeners get a 25% discount with the code circularityfm25. Visit Entlich.co/academy and add circularityfm25 as the discount code. This is circularityfm25 in one word. You will find the link to the Entlich Academy in the show notes.
[00:22:56] Circular Supply Chains, Lower Risk
Patrick Hypscher: OK. And given we’re, we’re talking here behind the context of circularity and in circularity, you often also discussed of course the physical locations in the context of supply chains and you mentioned also resilience before. So how does it help me as a company to come up with a more resilient supply chain?
Michael Bruch: Yeah, a very concrete example and we had a collaboration last year with an automotive OEM together with academia and there we, well, not only discussed but also published a white paper on the topic of how circular economy can ease the risks of business interruption, especially in the supply chain. And also the risk or mitigate the risk of geopolitical, let’s say dependencies. Because taking rare earth as a, as a very important raw material for batteries, electric batteries, you, you can imagine that it’s very hard if you are dependent on like China. Being dependent on such very important raw material makes you also dependent in, in terms of your supply chain and very vulnerable. So therefore, when you are investing into circular economy like battery recycling, that helps you as well really to get more independent from, from those supply chains.
And then the link to CAReS is that you can analyse like Lena described your supplier locations. So what are really kind of recycling companies or suppliers, nearby, nearshore suppliers, you might be dependent on, really to analyse what kind of events could hit those suppliers and what kind of, let’s say backup suppliers I, I could have in my dedicated supply chain management plan to really mitigate such a risk.
Patrick Hypscher: OK. And to be clear, it’s covering climate related risks and not so much political risks, right?
Michael Bruch: Currently it’s not part of CAReS because it’s, it’s really the climate change driven natural catastrophes. But we are of course thinking about other services because exactly what you’re saying, geopolitical conflicts, think about terrorist supply chain risk, supply chain quantification in general, cyber risk is a big topic. All those topics are raised by our clients to come up with dedicated services on, on making their operations more resilient and not only their own operations but also the suppliers’ operations.
Patrick Hypscher: And if I try to bring it back also again to circularity, I can also imagine that if I, based on the results of CAReS, see my risk exposure related to certain physical locations by suppliers or within my own network. And I then see, OK, I can, let’s say, reduce the revenue share that is dependent on these locations by, for example, recycling measures or of course also redundant suppliers. This would be like a strategy. So that would be kind of the next step, how I deal with the CAReS result and what are my risk mitigation measures and circular strategies could be one of the risk mitigation measures. Do I understand that correctly?
Michael Bruch: You’ve described that very well.
Patrick Hypscher: And where, where do you want to go with CAReS? I mean, you just started, you have a few examples here and there and yeah, where do you want to go? And do you already see if this is going in that direction?
Michael Bruch: So what we are seeing as well, new features the clients are asking for just to take storm surge or heavy rainfalls as one example. There are multiple other areas we are, we want to invest in. Another very interesting feature for our clients is kind of, OK, I’m investing now into a resilience measure, building a dam or other resilience measures. So how does that impact my insurance coverage as of now?
When you take for example property coverage or property policies, normally you have annual policies. But of course there is a strong interest from clients if they are investing into something which protects them against the 1 in 100, 1 in 200 flood event. They would like to see that this kind of has an impact on their coverage and that they get an incentivization to use and to invest into loss prevention methods.
And on, on top of that, we want to invest into new services. And so all those services we see from the different industry sectors, specific needs on those services where we want to invest into as well.
[00:28:26] Location Over Industry
Patrick Hypscher: Can you already spot the patterns for the, let’s say winner group within CAReS where we see these are companies that score rather high and this is a pattern why they’re scoring high or high in a positive sense, so they’re not so risk exposed.
Michael Bruch: That’s a difficult question. I would say there are no industry sectors immune against those risks. So there is not really by saying, OK, I don’t know, tourism is performing better than agriculture or manufacturing clients. It’s really highly dependent on their supply chains, on their business model in general, how they are spread across the globe with their own operations and supplier operations. So it’s really highly, it’s, it’s difficult to say one is better than the others or better or more resilient than the others. Of course, if you have a kind of, with just a few locations and not being dependent so much on clients in, in, in different countries or across the globe or being dependent on suppliers or bottleneck suppliers on specific raw materials, and it’s, it’s a different story of course.
Lena Fuldauer: Agreed. And as I mentioned on the framework earlier, it’s really around the changes in terms of hazard, exposure and vulnerability. So as Michael said, it’s less about necessarily which particular industry, but it’s more really about where are they located. So where are they exposed to changes in the hazard component. And then the other aspect is how vulnerable are they? And that is again something that, there are the sector specific, but is really based on building standards, based on how, how did they build a certain, how flood resilient are they, how wind resilient are they.
Again, it’s different if you are of course an office building, what types of factors you look at in terms of vulnerability, then let’s say if you have a lot of outdoor workers in terms of exposure to extreme temperature. So completely agree with Michael. It’s, it’s not really a pattern in terms of industry. It’s really more location specific and vulnerability specific.
Michael Bruch: And on top of that, what we’ve learned, which is also interesting to hear from clients, is that a tool of course can be just a starting point. You cannot cover all topics, kind of very client specific topics via a tool. Just to give a very concrete example on infrastructure companies. So we talked to pipeline operators and their concern is, if you have a combination of heat waves followed by heavy rainfall for, for example, in a, in a certain kind of pattern that increases corrosion in their pipeline. So this requires more maintenance, more investment into maintenance and, and, and, and those kind of follow up actions, follow up investments, which is then, which you can then of course advise the clients with a dedicated expertise, where we have the lessons learned from claims we have seen already and then and can offer and, and deliver to our clients.
Patrick Hypscher: So right now we, we talked a lot about, let’s say the physical assets. And is there also an element where you draw the line to how the company operates, what’s the business model and how the company itself also might even drive climate change?
Michael Bruch: It’s an interesting question. In general, I would say, of course, we are looking not only into their physical assets or individual locations. So when we as risk engineers do the risk assessments within the underwriting, so the insurance process, we look into the organization from the top because as you know, it’s, it’s, it’s one question of course how the kind of physical assets are exposed or are protected.
The other question is exactly what you were asking is what’s the management and organization of this company? How, what’s the kind of risk management culture they have in place? Is it really that they live a kind of safety culture in, in, in their company? And is the business model structured in a way that you have always kind of loops where you question, is safety in place? And did I protect my, my processes, my organization in the right way, plus then of course the kind of business continuity management you need to have in place to, to come back after such heavy events then as fast as possible.
So it’s, it’s within the insurance context, we are looking into that. But more and more we want to kind of offer such a kind of systemic risk advice service directly to clients as well. Because the beauty of being a risk engineer is as well, you are not the only kind of part of this insurance solution, but also you get questions from clients early on when they even haven’t started to think about insurance. Because when you go through the risk management cycle, loss prevention, identifying the risk, evaluating the risk, thinking about loss prevention comes at a very early stage. And all the risk which cannot be mitigated in a, in a kind of smart way, then needs to be transferred to an insurer. But across the whole value chain, loss prevention plays an important role.
[00:34:47] Finding Allies Inside Companies
Patrick Hypscher: Who are the people you’re talking to on, on client side? So what, what kind of functions are relevant? And, and the reason why I’m asking is that for sustainability, circularity professionals, it’s always really important to find allies in the company to make the commercial impact of certain decisions transparent. So, so who are the people you are talking to when it comes to vulnerable assets?
Lena Fuldauer: Our first contact point is usually the insurance and risk manager of a company because that is the person that we usually have the closest relationship already. And it then is what we found most valuable is when they bring along their sustainability ESG team. And that combination of risk insurance manager and ESG sustainability teams is usually where we have the most useful and proactive conversations that also then help the companies drive the conversation internally, because it’s often the sustainability ESG colleagues who have the tools, who have the knowledge for more, coming more from the sustainability. And as you mentioned, circularity aspect and the risk and insurance managers who often have asset level data, they’re close to the databases of the company.
They have also the relationships to the various different production facilities as to what is happening where, risk management systems that have been in place for a while. So it’s then bringing these aspects together with new services around climate, around sustainability.
Patrick Hypscher: And what about teams from the CFO or the COO line?
Michael Bruch: So COO, I would say that’s also interesting to see also within our own Allianz company. It’s, it’s really the own operations and the resilience of own operations plays an important role. So we are talking to environmental managers within the organization of the different Allianz entities because they want to use the tool as well to identify weaknesses.
Patrick Hypscher: That’s a good sign that you want to use it yourself, yeah.
Michael Bruch: Yeah, exactly. Otherwise it would be a little bit awkward if you wouldn’t use it ourselves. But really, resilience plays an important role, fortunately for our own organization as well.
Patrick Hypscher: Sure. Which is a no-brainer. Yeah. And in the, in the CFO, I guess the person responsible for insurance is already sitting in the CFO organization for most of the clients or…
Michael Bruch: It, yeah, it’s the risk manager. So you, you have a kind of, Lena mentioned the risk manager. Then in, in large corporate companies, you have especially in Germany, so-called in-house brokers who are responsible for the, for buying insurance coverages.
And beside the risk manager, you have also, we see the investment function being very interested in, in those topics as well. Because when you want to invest into or are kind of engaged in mergers and acquisitions or any investment decision, the kind of, let’s call it environmental due diligence, sustainability due diligence plays an important role as well.
[00:38:28] Circularity in Insurance: The Outlook
Patrick Hypscher: And coming close to the end, one of my last questions is a bit about the outlook when it comes to circularity. Do you expect or already see in the data some effect of circular measures, resilience measures? I mean the, the term resilience seems to be popular since three to four years. So do you see already positive effects there in your data or do we still have to overcome the biggest challenges?
Michael Bruch: I mean it’s, as we are in the market with CAReS only since July this year, we don’t see very tangible data which are linked to circularity I would say. But in general what we are seeing and that’s very special to the retail business, to motor insurance. So Allianz is the main driver of using also instead of repair with new parts, also recycled parts or used parts. And this has a huge impact of course, on sustainability, CO2 emissions, on the CO2 footprint.
And therefore those elements of, let’s say in the claims area, loss adjustment area, we see a lot of interest to push that further, which helps of course on the resilience, but especially also on the sustainability side.
Patrick Hypscher: Yeah. And hopefully, I mean what you’re basically doing with CAReS is making risk more transparent so that companies can address it, mitigate it and reduce it ultimately. Michael, Lena, thanks for your time. I will add some link to CAReS and also link to the white paper, Michael, you mentioned about the resilience supply chain for everyone who’s interested. And I guess you’re happy if someone wants to reach out to you.
Michael Bruch: Thanks, Patrick. Super. Many thanks, Patrick.
Lena Fuldauer: Thank you so much for having us, Patrick.
[00:40:35] Outro
Patrick Hypscher: This marked our first episode in the series Enabling Circularity Through Insurance. If you want to get the key learnings from this conversation and an overview of upcoming circularity industry events around the world, sign up for the Circularity.fm newsletter. You can find it at www.circularity.fm. In the next episode, we have a closer look on how Trygg, a Danish insurance company, built and scaled a repair-first policy. Meanwhile, let’s drive a profitable circular economy. And please don’t forget, the most abundant renewable resource is your imagination.
Jingle: My name is Patrick Hypscher and this is Circularity.fm, the podcast about understanding, building and managing circular business models.