Risk Cooperative CEO Andres Franzetti Details the Origins of His Company and How the Pandemic Produced Industry Resiliency
R&I: What was your first job?
My first job out of college was working in the finance space for a mortgage company. I was a loan officer for the company and, much like in the insurance world, the core focus was to pre-underwrite risks for the banks to be comfortable in extending loans.
R&I: How did you come to your current position?
After working for various companies in the insurance world, I kept growing frustrated with how the “traditional” brokerages approached risk and their clients. This led me, along with some trusted partners, to launch our own insurance brokerage firm — Risk Cooperative.
Launching my own company was not an easy undertaking as we started from scratch, but it allowed me to execute our vision of a strategic, consultative insurance brokerage that helped clients go beyond merely buying insurance, but rather leverage risk transfer to build resiliency and meet their key business objectives.
We work with clients to shift the perception of insurance as a compliance requirement — the cost of doing business — to insurance as an investment in their company’s growth and ability to participate in new business opportunities. I transitioned over the years from chief strategy officer to CEO and since then, have had the fortunate luck of building a world-class team around me.
R&I: What’s been the biggest change in risk management and the insurance industry since you’ve been in it?
When I started in the insurance industry, risk management was just beginning to transition towards enterprise risk management. This change, while subtle, meant organizations were starting to realize that certain risks are interconnected, and they needed to go beyond the previous silos they had been taught to apply. At Risk Cooperative we’ve coined the term “risk agility” to describe the benefit of approaching risk in this broader way.
I think this is the biggest change in our industry as the risk landscape continues to grow more complex and interconnected. Companies are having to contemplate how to manage their risks from technology, reputational exposures, and extreme weather events. Both insurers and insureds are now having to deal with the effects of these new threats.
Right now, the industry is trying to recalibrate itself to more accurately underwrite and price these threats after having seen very large losses over the past few years. Premium increases have also forced clients to rethink their insurance spending and explore alternative risk transfer options.
R&I: What’s the biggest challenge you’ve faced in your career?
I think for many executives navigating the COVID pandemic was an unexpected and unique challenge. For Risk Cooperative, we not only had to address the safety and operational continuity for our team, but we also had to assist many of our clients. From navigating their insurance medical claims, to drafting emergency response plans, it was a very fluid situation for the first few months with information constantly shifting.
Now, our team has adapted to this new operating reality, and, collectively, we’ve learned how to be more resilient in the face of adversity.
R&I: Who has been your mentor(s) and why?
My mentor has been my colleague and business partner, Dante Disparte. I met Dante early on in my insurance career where he was the managing director of the insurance firm, and I was leading the firms’ strategic partnerships. Dante invested his time and resources to helping me further my professional development and always encouraged me to continue innovating.
Under his guidance, we developed several truly innovative insurance solutions together and built a very successful program. Dante continues to push me to reach new and greater heights and is always a great sounding board for working through any complicated issues that may come up.
R&I: What is the risk management community doing right?
The risk management community is doing a lot right.
I think two key things that risk managers are doing are creating more information sharing groups as well as incorporating more technology into their risk management programs.
It is always easy for organizations to create echo chambers, but having these information sharing groups across industries allow risk managers to obtain new perspectives on how to mitigate risk and can even present new threats that, while in a different industry, are applicable to them as well. This type of information sharing is critical for such risks as cyber, where early knowledge of a potential threat can thwart a cyber breach.
Likewise, incorporating technology into risk management programs has been critical. Technology and automation can be a game changer when it comes to areas like supply chain risk and vendor management
R&I: What could the risk management community be doing a better job of?
I think risk managers could be more agile and strategic. While risk management has made some advancements over the past few years, it is still very much a slow-moving process that focuses all too often on past experience to predict the future.
We need to be better at adapting to a more fluid risk environment and tapping into risk transfer solutions like insurance to help us build greater resiliency when dealing with these emerging risks like climate change, cyber and digital assets to name a few.
R&I: How would you say technology has impacted the risk management profession?
Technology has greatly impacted the risk management profession both in a positive and negative light.
The positive aspects are that technology can help make the jobs of risk managers easier by helping to provide more standardization, greater data analytics, tracking and other such functions that greatly aid many areas of a risk manager’s job.
However, the proliferation of technology devices in the workplace has created a huge cyber risk for organizations. Risk managers now need to work hand in hand with their IT departments to stay on top of devices, staff use, and general policy adherence to avoid data being compromised or systems getting hacked. This can be a 24/7 job on its own.
R&I: What’s your favorite book or movie?
My favorite book is The Alchemist by Paulo Coelho.
R&I: What have you accomplished that you are most proud of?
I’m generally proud of many things I’ve accomplished and, equally, think I have much more to do. One key accomplishment, certainly, is my company and the terrific team that makes it work. I’m very proud of the highly diverse team we’ve built and that we have been able to hold true to our founding principles.
R&I: What is the riskiest activity you’ve ever engaged in?
I would have to say that my riskiest activity was going sky diving. I was much younger and haven’t jumped out of a perfectly working airplane since then!