As the final installment of the Top of Mind series, Academic Director Teresa Chan closes out her conversation series featuring contributions from M.S. in Insurance Management lecturers on industry impacts of COVID-19.
What are the short and/ or long-term effects of this pandemic on each of the key operational divisions within insurance companies, intermediaries and reinsurers?
For every event that causes loss and requires individuals and businesses to regroup and reposition themselves, there are opportunities to accelerate change and innovation. Clearly, COVID-19’s reach is deeper in impact and broader in scope than anything we have experienced in modern times.
This event propelled concerted nationwide, and global, responses for survival and continuity.”Teresa Chan, Academic Director - M.S. in Insurance Management Program
Since mid-March, business agility has been tested, and amidst the struggles, there have been positive developments arising from COVID-19.
The proliferation of webinars, task forces and discussions was an early indicator of renewal activity. New professional service offerings by law firms, consultants, and entrepreneurs quickly surfaced. Across many industries, business models are transforming to meet new and modified consumer demands, and to address shortcomings in the reliability of traditional upstream and downstream business relationships. The highest level of productivity ever seen by some entities emerged in the ultimate test for the remote work model. As these changes take hold, the insurance industry can be there to support them.
Looking towards the future,
- Insurance providers should continue to deepen understanding of their insureds’ businesses and motivate them to be more tactically prepared to weather seemingly inevitable future COVID-like situations.
- The upstream and downstream reliance of businesses on each other has been magnified, and it is an opportune time to map out these relationships for risk transfer opportunities. Risk managers and insurance providers can both benefit from this exercise.
- Financial markets may seek clients who can demonstrate more elastic business and risk management plans that could be supported by insurers. Perhaps a policy can be constructed to help small businesses manage unexpected operational pivots under specific conditions, like those who retrofitted their manufacturing facilities to produce alternative products.
- Insurance and other intermediaries with consulting practices can support risk managers with advisory services that complement new strategies in risk management resulting from COVID. They can facilitate increased collaboration with carriers to produce new risk transfer solutions.
- Since business interruption coverage has made the headlines, more people understand it better now than before, whether or not they’re business owners. It highlights the gaps in knowledge about how insurance works, so enabling broader education about insurance will help elevate the critical role of insurance in every facet of life and industry.