Main Causes for and Management of Insurance Industry's Reputation Risk

Reputation is the foundation for the entire insurance industry. Reputation risk of the insurance industry and insurance company are in a mutual cause-effect relation,while the former is a more important and urgent issue to be addressed. The insurance industry's reputation risk is determined by all the participants and stakeholders within the industry. It is essential to stand on the perspective of the entire industry and consider the management approaches,so as to enhance and maintain the good image of the industry. This paper startsed from defining implied meaning of insurance industry's reputation risk. The paper identified the main causes of the industry's reputation risk and their interactions. It concluded that reputation risk of the industry was a case of systemic risk. The industry should manage it through industry governance. The paper proposed two management and control principles and also the relevant approaches.