As insurers track both old and new risks heading into 2019, here’s one that carriers don’t typically consider: The White House.

David Wessel, director of The Hutchins Center on Fiscal and Monetary Policy, cited the Trump White House and its volatility as a major political risk during a Jan. 17 panel discussion at the Insurance Information Institute’s Joint Industry Forum.

“The top geopolitical risk, I am afraid, is in the White House,” Wessel said. “I don’t think that people in Washington have confidence that this administration could handle a crisis as ably as the Bush or Obama administrations. That would be at the top of my list.”

Earlier in the panel discussion, Wessel cited the ongoing situation in Washington with the partial government shutdown as a short-term risk of its own with wide-ranging implications.

“It is causing economic distress, an erosion of trust in our government, and it makes me worry about when we hit the debt ceiling later this year, on March 2,” said Wessel, also a senior fellow at the Brookings Institution. “This business about not being able to get business done in Washington is having real economic effects. It is also making it difficult for Washington to deal with really serious economic issues.”

Wessel sees other, broader global risks as potentially causing harm to both insurers and society alike. They include:

• The economic slowdown in Europe and China. This is driven in part by the Trump administration’s trade wars with both entities, he said.
• Erosion of trust in institutions. While this is an immediate, short-term risk stemming from the partial government shutdown, Wessel said this is a longer-term risk worth great concern, with an across-the-board deterioration that will “make it very hard to get things done that need to be done.”
• Productivity growth. Wessel noted the below-1 percent annual growth from 2011 through 2018. Even though it has ticked up a bit in the last few quarters, he said that he feared investment is not keeping up with the apparent uptick in growth rate.
• Inequality. The earnings gap between people at the 90^th and 10^th percentiles is now at 13 times, up from nine in the early 1980s. “This is not an easy problem to solve,” Wessel said. “Taxes will be part of [the solution], but we have to find a way to deal with fundamental issues of discrimination and education.”
• Climate change. Wessel noted the efforts of Swiss Re, Munich Re and Allstate, among others to promote resilience in the face of climate change. But “it is an opportunity for the industry to show even more leadership than it has,” Wessel said. “Climate change is one of those things that we’re not going to deal with unless the leadership of the country in politics and business” show the way.

Panelist Jay Gelb noted other risks to worry about in the coming year. Gelb, managing director, Barclays, said that flood insurance and cyber attacks offer both risk and opportunity for insurers in figuring out ways to cover both effectively. Distracted driving is another risk to follow, he said, with the hope that personal auto insurers find “more proactive ways of addressing the dangers of distracted riving.”