The elections have come and gone — now it’s time for businesses and organizations to deal with the aftermath.

Risk managers need to be aware of several critical areas of potential change following the 2016 United States presidential and congressional elections, according to New York City-based insurance broking and risk management company, Marsh.

Immigration and trade have been front-and-center of Trump’s campaign for president, but it’s unclear what exactly he will do on those issues. Among Trump’s proposals is a temporary moratorium on new business regulations and a directive to federal agencies “to submit a list of every wasteful and unnecessary regulation which kills jobs, and which does not improve public safety, and eliminate them.”

Trump and GOP leaders in Congress have vowed to repeal Obamacare, but have not offered specifics, to date.

Here’s a summary from Marsh of four major exposures risk managers and insurance agents/brokers can help businesses watch and evaluate as we head into 2017: 

1. Cyber risk

The election campaign raised complex questions about cybersecurity, leaked private information, and cyber laws.

Potential risks:

  • Determining the legitimacy of breached and leaked information.
  • Changing expectation of privacy.
  • Shifting international laws.

How to prepare:

  • Review your company’s ability to authenticate digital information, including emails.
  • Regularly review relevant privacy issues, and adapt as needed.
  • Stay abreast of changes in international privacy and related laws. Work with risk advisors and counsel to make appropriate changes in order to comply.

According to Marsh’s 2016 “Excellence in Risk Management” report, 77 percent of organizations expect their investment in cyber risk management to increase over the next two years.

2. Trade policy

U.S. trade policy was a key issue in the 2016 campaigns. President-elect Donald Trump promised to get tougher on trade relations with most of our partners, including Canada, China and Mexico. 

Potential risks:

  • Increased U.S. trade barriers could spur a similar response in other countries.
  • Sanctions or tariffs can affect business contracts, potentially resulting in the cancellation of import/export licenses.
  • Governments have the authority to force U.S. corporations to divest shares in certain foreign enterprises.

How to prepare:

  • Assess political risk and trade credit risk, and your insurance options.
  • Closely monitor trade policy development to identify countries that may be affected.

The U.S. government has implemented “protectionist” measures against other countries more than a thousand times since November 2008, more than any other G20 member, according to the “20th Global Trade Alert Report.”


President-elect Donald Trump

President-elect Donald Trump speaks during an election night rally in New York City. (Photo: Evan Vucci/AP Photo)

3. Regulation

Trump has made no secret of his goal to overhaul, and reduce, the federal government’s rules and regulations. According to Trump’s website, his vision includes reforming “the entire regulatory code” and eliminating “our most intrusive regulations.”

Potential risks:

  • Changes in regulations require affected companies to adapt and respond, especially if significant measures were previously implemented to comply.
  • Energy, environmental — including climate change — and financial regulations are among the key areas that could be affected.

How to prepare:

  • Maintain current regulatory compliance processes as any reforms will take time to implement.
  • Stay informed of development in Congress and regulatory bodies.
  • Be prepared to revise processes and provide training.

Federal regulation is estimated to cost more than $2 trillion annually, according to the National Association of Manufacturers

4. Health care

The Affordable Care Act was a hotly debated issue in the 2016 campaign. Presidential candidate Donald Trump vowed to repeal the ACA, also known as Obamacare. On Friday, Trump told The Wall Street Journal and CBS News show “60 Minutes“ he is willing to keep parts of Obamacare, indicating he values two ACA features: a ban on insurers denying coverage to individuals with pre-existing conditions and a provision allowing children to stay on their parents’ plans for a period of time.

Potential risks:

  • Insurers and health systems have made significant investments to comply with the ACA.
  • Major changes in the law could devalue investments and create additional uncertainty and complexity in the U.S. health care system.
  • With Republicans now controlling the White House and Congress, there could be greater regulatory uncertainty in the short term.

How to prepare:

  • Health care organizations should continue to focus on complying with the changing laws.
  • Use appropriate data and analytics to measure the law’s impact on historical financial frameworks and evaluate business models accordingly.

Among health care organizations, 84 percent said their next critical risks will emerge from regulatory issues — more than from any other area, according to the 2016 Marsh Excellence in Risk Management Survey.

Here’s an infographic from Marsh to review and share:

U.S. Election 2016: Evaluation risk

 (Source: Marsh)