Over the last 9 months, the specie market and the financial industry have seen the value of stored assets increase exponentially. At the mid-year point, for example, this report was tracking the value of gold as up 30 – 50% over 2019, while this update from The Economist around the same time saw the value of cash in U.S. circulation up 11% since February. On the surface, these increases appear as positive developments for those with ownership over the assets, but they are being driven by marketplace uncertainty due to the COVID-19 pandemic. Regardless of how or why it’s happening, this very real and rapid increase in value creates new insurance risks with immediate security implications for all involved.
We sat with Director of Global Operations Neil Watson and Director of U.S. Operations Mike Hyman to help us understand from both the UK and U.S. perspective how businesses can evaluate their security measures, discuss the most common mistakes businesses storing these assets make and forecast how these marketplace changes are disrupting risk assessments and insurance underwriting.
“As the pandemic has hit and times are tight, businesses have leaned on employees that aren’t necessarily adequately trained to move valuables around or audit inventory,” Hyman observed. “For example, if an employer asks a teller to conduct a cash delivery on behalf of the business, that person is not adequately trained to do that.”
“None of us have a crystal ball,” Watson noted. “Is the price of gold going to continue to increase? We’re seeing questions around bullion storage, as well. In the UK, there’s talk of cashless society, which could lead to layoffs, which could cause concern and upset. That would lead us to think more about employee management and infidelity. The risks are going to continue and we just need to be there for our clients to mitigate those risks as the trends ebb and flow.”