Covid 19 – What does This Mean for the Insurance Industry?

With the ever-growing uncertainty around Covid-19 and what this will mean for business across the globe, we will undoubtedly have to adapt and learn to overcome the new challenges we are all facing. Covid-19 is having an effect on everybody’s day to day life with supermarkets seeing more demand than ever before and unfortunately, many businesses being forced to furlough and terminate some people’s employment.

In a time, full of uncertainty this blog is here to give some clarity on what impact Covid-19 is having on insurance as an industry and will also delve into some specific industries, providing insight on the effects that people are seeing across the sector. Insurance as an industry has been affected in terms of employees, insurance providers, brokers and also a big impact on clients and their insurance policies. We will aim to shed some light on the main issues.

What does it Mean for Insurance Brokers?

The insurance broker community are working tirelessly towards continuity of normal day to day work. For many, this has meant a change in the work environment with many broker companies switching to remote working for the foreseeable. This poses a new set of risks from a cyber security and data protection point of view.

With many workers having access to a range of confidential files an email, insurance brokers must have the relevant security measures in place to prevent people from exploiting a home network. One way for brokers to easily get around this is to allow employees to use a tool called remote desktop, this means there is a virtual version of an employee’s computer available that they can access from their home. Cyber security needs to be a top priority for brokers continuing to operate in the current climate

What has the Impact been on Different Types of Insurance

Property Insurance

One of the areas of insurance that has been hit throughout the outbreak is both commercial and personal property insurance. Because of premises being left unoccupied many property owners are breaching their insurance cover and not adhering to their policies. In most policies, there are restrictions relating to how long premises can go unoccupied.

Once this date has been reached in some cases, peoples property is not insured. It is vital that people check their wording of documents and for brokers to advise their clients on the risk that is apparent for those who are not occupying certain premises 1. Reaching out to insurers to find their view and stance on this will be vital to see what can be done to minimize the risk for clients.

Working From Home – Implications for Brokers

For brokers that will be allowing staff to work offsite. Insurers will need to understand the requirements for their staff both from a technological point of view and also physical in terms of any files that they may need whilst working from home. As mentioned above, one of the most important things to consider is the cyber security aspect of working from home.

To allow employees to work with ease from home, it is highly recommended that any insurance brokers set up a virtual working network – this means that people will be able to connect to the network remotely and access highly sensitive documents on a secure connection  2.

What Are the Big Insurance Providers Saying?

As with any insurance-related matter, you have a range of insurance companies to consider – there are prestigious, expensive providers who are going above and beyond for clients. They are allowing some customers to have extensions on the terms of their insurance in which it stipulates if a building is left unoccupied then they will no longer be covered.

Allowing people to flexibly change this relieves a lot of stress for many commercial and personal property owners. It is important to note that not all insurance providers are doing this and it is vital that both brokers, clients and anyone who has Commercial Building Insurance policies looks into their wording of contracts and gets clarity on the points relating to lack of occupancy.

We hope that this has helped clarify some things for you.

Let us know your thoughts on the impact COVID-19 has had on the insurance industry in the comments below.

Sources for this article:

https://www.marshcommercial.co.uk/articles/coronavirus-impact-on-commercial-property-and-real-estate/

https://www2.deloitte.com/uk/en/insights/economy/covid-19/impact-of-covid-19-on-insurers.html

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About FinanceGAB

Ajeet Sharma is a financial blogger and I am blogging since 2017. Financegab is a personal blog dedicated to personal finance. The main aim of this blog to help people to make well-informed financial decisions.
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