Owing to their size, their involvement in complex transactions and the fact that they handle huge sums of money on a daily basis, financial institutions have a broad range of operational risk issues that can result in both insurable and non-insurable losses.

• Institutions such as investment banks are exposed if the advice they provide to clients is incorrect, inconsistent or poorly researched. In large transactions such as Mergers & Acquisitions and Initial Public Offerings, the exposures are particularly large.
• For trading and brokerage operations, mis-keying of data can result in rogue trades which have the potential to cause significant losses.
• Fund management firms may be subject to an investor claim for breach of mandate should the manager invest outside of their stated investment objectives.
• Retail banks have a range of exposures - fraud, computer crime, hacking, extortion and armed robbery are all important risk events.
• Financial advisers may provide inappropriate advice to their clients if they fail adequately to understand their financial requirements or do not communicate fully the reasons associated with any recommended investment allocation or strategy.

Marsh has a dedicated Financial Institutions team with a wide range of experience in dealing with all aspects of clients’ insurance programmes.