FERMA Leader Urged Longer Insurance Renewal Cycles
Businesses should align insurance planning with three-to-five-year operational cycles to manage long-term risks.
Updated on Oct. 5, 2026 in Remote Work
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Should insurance companies move from annual renewals to multi-year agreements to better support long-term business planning?
FERMA President Philippe Cotelle called for a shift in insurance renewal processes to better match corporate planning, which typically spans three to five years. This proposal, discussed at the 2026 FERMA Forum in Rotterdam, aims to reconcile the mismatch between annual insurance terms and long-term business strategy.
Why it matters
The current annual insurance cycle creates a misalignment that prevents businesses from effectively addressing long-term risks. Bridging this gap is necessary to provide coverage stability and prepare for emerging liabilities that persist beyond a single year.
Corporate operational planning typically functions on 3-to-5-year cycles, whereas standard insurance renewals occur annually. It remains unknown how specific policy language will evolve to bridge this duration gap.
The players
Philippe Cotelle
President of the Federation of European Risk Management Associations, representing the interests of risk managers across various sectors.
FERMA
The Federation of European Risk Management Associations, a primary body representing risk managers and influencing European insurance standards.
The details
Philippe Cotelle highlighted that the exclusion of artificial intelligence from insurance policy wordings creates significant uncertainty for operators. By urging a move toward multi-year planning, FERMA aims to facilitate a dialogue between insurers and businesses to better define how new technologies are covered. This shift would require insurers to move away from the rigid annual renewal model that currently dominates the market.
Timeline
The FERMA Forum 2026 occurred in Rotterdam during 2026.
Market Landscape
This proposal marks a structural departure from the industry-wide reliance on the standard annual insurance policy renewal cycle. It highlights the growing tension between traditional coverage models and the long-term risk profile of modern enterprise.
Operators should evaluate whether their current insurance coverage accounts for multi-year business goals or if it leaves them exposed during longer operational shifts. Engage with brokers to determine if long-term risk management clauses can be integrated into existing contract negotiations.
The takeaway
The mismatch between annual insurance cycles and multi-year corporate strategy requires immediate attention to manage emerging technology risks. Review current insurance contracts to identify gaps in AI-related coverage and discuss multi-year policy structures with your risk management partners.
Further reading
For broader insights into how organizational structures are evolving, see Remote Work.
Live Poll
Should insurance companies move from annual renewals to multi-year agreements to better support long-term business planning?
