We were excited to learn last week that the Risk & Insurance Management Society has named Loren Nickel as its Risk Manager of the Year. Loren has been on our advisory board for going on a year...but is perhaps a bit better-known for his day job as the director of business risk and insurance at Google.
While great risk managers generally go unnoticed—the plane that lands safely doesn't get much coverage—Loren's handiwork at least peeks into public view from time to time as Google provides some structure around its "moon shots." The rest of us may focus on the extraordinary possibilities of X projects like the driverless car, recently spun out into a business unit called Waymo as the cars edge ever closer to widespread availability; Loren and his team provide discipline by quantifying the risks so that the X lab, the nascent business units or the parent company know what risk they are assuming and manage it as efficiently as possible. Google may seem to us outsiders as though it has a limitless balance sheet, but even Google needs to be smart about the risks it takes on.
The announcement from RIMS also notes a contribution by Loren to the theoretical basis for risk management: "Loren co-developed (along with Ward Ching from Aon) the theory behind an important strategic risk management effort, the Efficient Frontier. Used for insurance structure decision-making, the Efficient Frontier helped [Google] simplify such decisions and demonstrated the opportunity to significantly reduce risk as measured by Total Value at Risk, all without an increase in spending." Essentially, Loren and Ward explained how to apply Modern Portfolio Theory—and a whole lot of computing power—to decide what insurance coverage to carry. (The work is part of a book available through RIMS.)
At ITL, Loren has played a key role in our Shaping the Future symposiums. He has hosted these gatherings of about 30 CEOs of major insurance companies at Google headquarters and has provided thought-provoking technical content—at the meeting last month, Diane Greene, one of the biggest names in Silicon Valley, laid out Google's vision for the cloud and discussed with attendees the implications for insurance. We see these day-and-a-half sessions as crucial to our goal of acting as a catalyst for innovation, and having access to the best technical experts is a huge plus. Loren has also provided important advice about our Innovator's Edge, which now contains information on nearly 900 insurtechs and which we are rolling out to providers that are looking to find suppliers, partners or acquisition candidates as they seek to become more innovative. (Insurtechs: Remember that we will announce our initial "5 Startups to Watch" in "Six Things" next week, drawing from those that have completed our Market Maturity Review. If you want to be considered for our list, you need to go to the site and fill out the review by end of day Friday.)
We are also delighted to announce two additions to our advisory board:
• Michael J. Morrissey, president and chief executive officer of the International Insurance Society. The IIS is the world’s largest and most diverse industry organization, with members representing global insurance leaders, international regulatory authorities and worldwide insurance scholars from more than 95 countries.
• Chuck Wallace, a co-founder of Esurance who had numerous senior positions there. He currently serves as an adviser and consultant with early-stage and high-growth companies, with a focus on insurtech.
They join an exceptionally distinguished group of advisers, which, as it happens, includes two previous winners of the Risk Manager of the Year Award: Chris Mandel and Jeff Pettegrew. We are in good hands.