How covid impacts insurance industry.

Byline: NAZIR AHMED SHAIKH

The COVID-19 crisis continues to have a significant impact on individuals, society, businesses, and the wider economy across the globe. The insurance industry has no exception. As the global economy recovers and responds to the pandemic, insurers have also faced several challenges but also see the Impact of COVID-19 on the Global Insurance Industry in many new opportunities. Broadly speaking, the COVID-19 pandemic has swept westwards across the world starting from China, at the end of 2019, spreader all over the world at a lightning speed.

In Asia, where the virus struck first, insurers took rapid action to respond to the rapidly unfolding situation and are now one hopes, on the verge of moving into a period of assessment to gauge where the market heads from here and what the long-term impact may be.

In Europe and North America, however, insurers are still very much in the eye of the storm - configuring their operations to cope and trying to establish what business as usual looks like in extraordinary times. The most obvious theme has been the suddenness of the impact of the virus and the substantial effect on how insurers (along with businesses of all kinds) run their operations. Insurance companies have had to shift almost their entire workforces to operating remotely while dealing with significantly increased activity in their claims functions. We will examine these operational issues in more detail in another article in this series.

Throughout the pandemic, the Insurers have significantly increased their communication with customers providing an admirable degree of proactive customer-driven support. There have been examples in numerous countries of insurers offering rebates on motor insurance given decreased levels of driving.

In Australia, as well as some other countries, private health insurers have been offering premium holidays and other benefits given that customers can't draw on their products which cover them for elective surgery and ancillary services like dental care. In the UK, meanwhile, some insurers have offered free motor cover and enhanced home cover for National Health Service (NHS) workers, as well as extending business cover to provide coverage for employees working from home.

While these are all positive actions, they also point to a problem: some insurance products have begun to feel out of step with the reality confronting customers, and thus with their needs. Many individuals have faced...