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The Future of Alternative Risk Transfer

Open minded professionals in the insurance and capital markets strongly believe that Alternative Risk Transfer (ART) is the future, however traditionalists think that it is just simply a phase. The main question that people have is whether or not ART methods can be executed in a more cost effective way compared to traditional insurance techniques. Mainly, companies that have transitioned to Enterprise Risk Management also look to alternative risk transfer and leave behind the obsolete methods of SILO. By using ART, risk is mitigated and there are considerable savings, and increased likelihood of return on investments. The success and future of ART is going to rely on the acknowledgement and guidelines set by nations and also international organizations.

Lam, J. (2014). Enterprise risk management: From incentives to controls. Hoboken: John Wiley & Sons.