Keeping insurance in business following Covid-19

London-insurance-market

Authored by CII Content Manager James Moorhouse

With many firms and organisations getting used to new remote working arrangements, how can this be sustained? And what sort of impact will this have on the running of businesses in the future?

The insurance sector is in the midst of an international crisis. People need insurance to operate and those that can’t are hoping they have sufficient cover to make a claim.

With brokers and claims handlers being the insurance professionals that people will turn to, the disruption caused by adapting to home-working must appear as seamless as possible. However, for these employees the challenges presented are not just in the transformation, but in remaining engaged.

Not everyone has the tools and equipment to make their job roles productive. A person living on their own in isolation will have a unique set of stresses and pressures to a family living together trying to co-ordinate a working day and childcare. There are also those who are directly affected by a diagnosis. It can be very difficult to stay motivated without distraction when no one really knows how long this will last. Responding to customer queries about the cover they have, or claims they want to make, may add further stress by having to handle calls about traumatic events, especially if they can’t always meet customer expectations.

The way that insurance companies treat their clients now will be how they will be judged in the future. This is why it’s important to get it right now. Insurance professionals need to be there for their clients so it’s important to maintain an effective communications strategy. For those that can continue to operate, they should be clear about being open for business. Good leadership can be demonstrated by speaking publicly, even if it’s just about concerns and the financial impact on the business and clients. Customers want to feel reassured that they can still contact insurance brokers as many will look upon them as professional advisers.

Many organisations have created their own repositories and online resource hubs to share information and their own insight. This is a good opportunity to see what competitors are doing, as well as checking whether your own brand is aligned with the company’s values. Keeping in touch with customers using a variety of formats will also help to keep people engaged and updated as many will get bored if there’s a reliance on text or email. There may also be an increase in customers seeking a personal touch, with telephone enquiries becoming more popular again.

But once we’ve all settled into the ‘new normal’, what digital changes will occur as a result of the COVID-19 pandemic? Both the insurance sector and consumers have turned to digital technology as a lifeline. This will inevitably lead to the acceleration of digital transformation to adapt to the way we interact. But this could also see the relationship between customers and insurers change too.

According to Accenture, 74% of consumers are happy to receive automated advice on which insurance policy to buy. This then raises the question of what value an insurance broker can provide if these methods of communication change. To prevent disintermediation, channels could be created for customers to make them feel more connected to the products they purchase. Coverage should be revised and re-evaluated regularly. Currently there will be many customers who feel disillusioned for paying for insurance that doesn’t protect them, as some products sold won’t pay out due to the current pandemic.

Prices may also increase, especially to ensure complete coverage. However, if this is the case then it needs to reflect a balance with the value of the product. New products are also likely to be created, especially those that reflect the needs of the gig economy. Regulators are also likely to look into immediate coverage needs and how digital services can support them.

COVID-19 will act as a catalyst into accelerating how governments and organisations switch to detail. Many firms had previously started updating their legacy systems, with the current situation testing how resilient they are. Now that many can see that working remotely is possible, this could also impact decisions on the way business is run in the future.

Will we see a mass return to the 9-5 office culture? Or will these changes influence a more flexible working style. Customers expect a 24 hour service which is more possible now that people’s working habits have changed. Open plan hot-design offices could also fall out of favour. What may have seemed like a more collaborative and economic idea may now seem less desirable.

Even though we are only a month into the lockdown, the changes for the both insurance sector and its customers has been huge. With many more changes yet to come. We are only just realising the potential of remote working and how to adapt to different types of need. As the situation develops, so should the response.  

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About CII

The Chartered Insurance Institute (CII), the leading professional body for the global financial services profession, exists to promote higher standards of integrity, technical competence and business capability.

With over 115,000 members in more than 150 countries, the CII is the world's largest professional body dedicated to insurance and financial services.

Our membership covers all disciplines within the insurance industry (claims, broking, underwriting), those working in the life and pensions sector, the mortgage advice market and financial advisers (under the Personal Finance Society brand).

Our Royal Charter requires us "to secure and justify the confidence of the public" in our members and in the insurance and financial services sector.

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