Rethinking war risk in an era of persistent conflict

Conflict risk is no longer limited to a single theater. It is increasingly multi-regional, fast-evolving, and more difficult to define in insurance terms than many corporate leaders expect. And as geopolitical volatility persists, organizations are learning that risk exposure isn’t determined only by where they operate, but also by where employees travel, where suppliers sit, how goods move, and what decisions companies make when a situation deteriorates quickly.

For compliance and risk leaders, the implication is clear. In today’s environment, war risk is not only a security issue or an insurance issue. It is a governance issue.

In conflict-prone environments, insurers increasingly want evidence of risk controls before they offer meaningful terms.

Insurance availability is not guaranteed

One of the most disruptive changes in the current market is the growing number of organizations discovering that insurance availability and affordability can be a challenge, particularly when operations, assets, or personnel touch high-risk regions.

Many executives understandably assume that purchasing coverage is primarily a budget decision: If we can afford it, we can buy it. In reality, coverage may be restricted, priced beyond reach, or unavailable altogether, especially when underwriters determine that an organization’s internal safety and response planning is insufficient.

From a compliance lens, this creates a significant challenge. Insurance is often treated as a downstream control, something that responds after a loss. But in conflict-prone environments, insurers increasingly want evidence of risk controls before they offer meaningful terms.

In practice, this shifts the conversation from “What coverage do we want?” to “What have we documented and implemented that proves we are a good risk?”

Underwriters are prioritizing preparedness

As geopolitical instability has increased, many insurers have raised scrutiny around operational readiness. Organizations may be asked to demonstrate risk protocols that go well beyond standard corporate travel policies or crisis communications templates.

For example, underwriters may expect documented processes around:

• Security and travel briefings prior to deployment
• Critical incident response protocols
• Coordination with travel assistance or crisis response providers
• Employee tracking capabilities
• Medical evacuation planning and decision authority
• Internal escalation and reporting structures
• Mitigation measures including transportation, accommodations and communication

For compliance and audit teams, these expectations should sound familiar. They are essentially the risk equivalents of internal controls: Standardized, repeatable, documented processes that reduce uncertainty and show governance discipline.

And increasingly, the quality of these controls can determine whether an organization receives insurance capacity at all.

War risk premiums are forcing strategic tradeoffs

Even when coverage is available, the cost can be prohibitive particularly for organizations operating in extreme-risk environments. That has forced many organizations to confront a difficult reality: Premium expense can become a constraint on mission, operations, and strategic execution.

This is where many organizations begin exploring alternatives to traditional risk transfers. A growing number are asking questions such as:

• Should we accept higher deductible or self-insured retention?
• Are we willing to absorb the first layer of loss to reduce premium costs?
• Does it make sense to purchase full limits, or only partial protection?
• Is an alternative risk transfer approach viable?

These are not decisions a risk team can make in isolation. They require coordination across finance, compliance, HR, operations, and in many cases board-level oversight. A shift toward self-insurance is, effectively, a decision to increase risk appetite, whether leadership labels it that way or not.

Duty of care has moved from theory to operational obligation

As war risk costs rise and coverage becomes less predictable, organizations are paying closer attention to duty of care not as legal jargon, but as an operational expectation.

Duty of care involves taking appropriate measures to protect employees and travelers against foreseeable risks. In high-risk contexts, expectation expands materially. It is no longer enough to have a policy document stating employees should “avoid unnecessary travel” or “monitor local conditions.” Organizations need to demonstrate that they have actively evaluated threats, secured risk appropriate resources, trained staff, and established response pathways.

This becomes even more complex when organizations deploy employees for extended durations or into environments where evacuation may be delayed, complicated, or impossible.

From a compliance standpoint, duty of care is not only about what an organization would do during a crisis. It is about documenting the steps it took beforehand:

• Were travelers trained and briefed?
• Were risks assessed, mitigated, and documented?
• Was decision-making authority clearly assigned?
• Were third-party partners vetted and in place?
• Are internal controls designed for predictable escalation pathways?

In other words, organizations are increasingly expected to show that duty of care is embedded into governance, and operations not treated as an HR checkbox.

The human side is often the least modeled risk

In many organizations, conflict risk planning focuses heavily on geography. Where an employee is being sent, how active the conflict is, what the political environment looks like. But one of the most overlooked variables is the individual.

Health history, fitness to travel, prior trauma exposure, and the psychological impact of operating in unstable environments all matter. Organizations that fail to consider these factors may face greater risk not only of harm to employees, but of operational breakdown when staff are unable to perform safely or sustainably.

This is where compliance leaders can play a meaningful role: Ensuring that “readiness” includes both physical risk controls and workforce-related governance. That may include coordination with HR, occupational health programs, and external travel assistance providers to build a more resilient support structure.

A broker’s role is shifting from placement to partnership

Historically, many organizations viewed brokers primarily as intermediaries useful for securing capacity, negotiating premiums, and handling renewal logistics.

In today’s environment, that view is changing. Organizations facing unstable geopolitical conditions need risk advisors who can help translate operational realities into an insurance narrative that underwriters can trust. They also need partners who understand that insurance decisions cannot be separated from incident response planning, traveler safety protocols, and governance frameworks.

And importantly, organizations benefit when insurers understand their preparedness. Stronger relationships between clients and insurers, where direct dialogue and collaboration are practical, can improve not just pricing and capacity discussions, but also outcomes when a loss occurs.

Where compliance leaders can focus now

For compliance officers, audit executives, and risk practitioners, the path forward is less about predicting the next flashpoint, and more about building resilience into the organization’s operating model.

That starts by recognizing a fundamental shift: In a persistent conflict environment, preparedness is no longer separate from insurance. Preparedness determines insurance.

Organizations that treat war risk as an isolated coverage problem may find themselves facing premium levels that constrain operations, or worse, gaps that become visible only after a crisis occurs.

But organizations that integrate duty of care, critical incident readiness, and disciplined governance into their approach will not only be better positioned to obtain coverage they will be better positioned to protect their people and sustain operations when volatility becomes the norm.