The outbreak of COVID 19 coronavirus, which started at the end of last year in China, has become a global epidemic. Although it seems to be slowing down in China now, the spread of the disease is accelerating elsewhere. The World Health Organization recently described Europe as its current “epicenter”. Governments are increasingly dramatic, closing borders, introducing barriers and travel restrictions, closing schools and universities, and banning mass gatherings such as sports events.
It is not known how the crisis will develop from here. In addition to the tragic number of people, this has a significant economic impact on the global supply chain. This causes significant fluctuations and some major stock market crashes. The ECB has expanded its quantitative expansion program to provide more liquidity, and the Fed was able to follow the case after declaring a “national emergency” with the United States and many other countries.
A crisis like Covid-19 affects all business areas but focuses on insurers in many different areas. To respond to this call center activity flow with a constantly changing workforce that insurance companies want to address.
Effects of COVID-19 on insurance business continuity
The COVID 19 outbreak affected many sectors, such as travel and transportation, energy, manufacturing, retail, and hospitality. Although its impact on the insurance industry is less severe, and it will continue to be important and extremely destructive. This ranges from employee and business continuity questions to customer service issues and operating profit. The immediate concern of insurers is employee protection, health and safety of sales partners and business continuity
Insurance companies have lost about 48% of their market value since the beginning of the crisis. Life and health insurance companies are particularly impacted, with an average decline of 58%. The cost of COVID-19 testing and treatment will likely be based on the profits of Indian health insurers. Some people believe that insurance companies are negatively affected by it, which will result in lower returns in the future:
A) Premium and wage income:
The life and income company will be affected by premium income in the short term, but it will recover in the long term. However, longer seismic impacts on short-term real estate and victims, new business premiums will continue in the long term.
B) Investment income:
Investment income will be significantly affected in the coming months due to the volatility in the financial markets and the expectation that interest rates will remain at a record level for the foreseeable future.
Life and disability insurance requirements are expected to increase. Health officials estimate that the number of deaths attributed to COVID-19 in India can only be between 200,000 and 1.2 million.
We recommend that insurance companies be proactive, model the effects of COVID-19 Claims, and then determine the best mitigation strategy. Other business functions should be reduced or stopped to focus on priority activities. Businesses should consider sectors such as customer experience, capital impact, etc to determine which business services should be prioritized.
Some common views on COVID-19 by the insurance industry
COVID-19 affects the insurance industry in a variety of ways, ranging from employee and business continuity issues to customer service issues and financial expectations. Some important problems and possible transactions faced by the insurers are as follows.
Insurers reacted to the outbreak of COVID 19 as a taxpayer, employer, and capital manager on various fronts. Each of them has its challenges not only for the insurance industry but also for the economy and society as a whole.
However, the most urgent concern of insurance companies is to ensure business continuity while ensuring the health and safety of intermediaries and intermediaries/dealers. Like the commercial policyholders they serve, insurance companies are encouraged to review and update their crisis management plans and take action to minimize disruptions to customers at the workplace.
If not done before, insurers should consider establishing cross-functional emergency decision-making teams to coordinate the company’s response, create new security protocols, and move faster when conditions change. A comprehensive communication system should also be available. Inform employees, dealers, and customers about the status of business continuity plans and personal safety instructions.
Numerous personal guidelines RAS guidelines. While accessing remote protocols, chief information officers, chief technology officers, and CISOs, third parties can access the following technology features:
1) Laptop or desktop computer, front access devices for authorized companies.
2) A virtual private network for secure and remote connection to business relationships.
3) Tools to collaborate on audio, video, and screen sharing.
4) Disabled employees and a remote IT support team working with employees.
Insurance companies should take care to protect themselves, lose their hearing, and take measures to regulate demand. This can be problematic when COVID turns 19. Is it important that a personal expert on the business or property is damaged and that the policyholder’s family is a COVID-19 member or an employee who interacts with the expert?
COVID-19 can also offer insurance services for an insurance company. H. Partners, brokers, and financial advisors have the same risk management and logistics contracts as those handled by their carriers because they have to work from their home. Personal meetings with customers and customer contacts should be responsible until the risk of exposure arises.
Impact on Insurer’s rights:
Insurers also talked about CODID 19 rights and visible rights. Security costs related to business classes and insurance formulations prepared by the insurance company. However, in general, the economic environment of the epidemic is concerned about how it can affect insurance companies’ growth and profitability expectations in their insurance and investment portfolios.
Financially, insurance companies also need to adjust their budgets and implementation plans, cash flow expectations, and investment portfolios in light of the latest developments. Possible tax implications for contingent liabilities discussed above should also be considered. For tax changes in India and worldwide, tax planning may need to be assessed during the current economic turmoil. Some of the tax items to consider include but are not limited to, changes in the India national and international regime, as well as other global tax developments.
In this case, insurance companies are expected to act as shock absorbers for companies and society. Financially, the industry is preparing for major loss events such as COVID-19 and should be well activated for various loss events. Insurers are also assisted in reinsuring most of their accounts. This is one of the ways the industry can spread risk.