Impact and News by Topic

How insurers can use big data to manage the Covid-19 pandemic.

BUSINESS AND COVID-19: SUPPORTING THE MOST VULNERABLE - RESPONSE FRAMEWORK

Jane Nelson, Director, Corporate Responsibility Initiative, Harvard Kennedy School
and Zahid Torres-Rahman, CEO, Business Fights Poverty 

2020

6 July - World Bank shelves plan for PEF 2.0 & further pandemic cat bonds: Report

14 Apr - World Bank pandemic bonds will be triggered if virus cases escalate in developing world

23 Mar - The payout from the World Bank issued pandemic catastrophe bonds, as well as the pandemic risk-linked swaps that were issued at the same time, may reach just under $196 million in total, if the ongoing Covid-19 coronavirus outbreak triggers the financial instruments.

5 May 2020  - Lessons from Covid-19 could help with climate change 

Increasingly regulators are looking at Covid-19-driven consumer protection issues.

OECD - Financial Consumer Protection responses to the Covid-19 crisis (country responses)

16 October 2020 - Center for Financial Inclusion 'COVID-19 Ushers in New Challenges for Consumer Protection'

15 October 2020 - UNCTAD 'Countries focus on protecting consumers amid and after COVID-19'

August 2020 - COVID-19 prompts insurers to boost healthcare innovation

June 2020 - Digital Finance & The COVID-19 Crisis, University of Hong Kong Faculty of Law Research Paper No. 2020/017 

28 May 2020 - How COVID-19 accelerates the digitalisation of the insurance customer journey

13 May 2020 How big tech plans to profit from the pandemic

BIS Bulletin - Technology to combat the pandemic: online appendix

Applications to combat the pandemic have been classified into four categories by country:
• Telemedicine applications provide remote medical consultation and counselling. The exact coverage of telemedicine varies across countries, ranging from new apps to record symptoms and provide Covid-19-related or other medical advice, to hospitals, clinics and new intermediaries offering video consultation with doctors on non-critical situations.
• Flow modelling applications detect aggregate movements of people or how many people pass through places and how quickly. This technology often uses aggregated and anonymous geolocation data to generate heat maps, which show if people are abiding by social distancing measures.
• Location tracking uses global positioning system (GPS) data or geofencing for individuals who are subject to a quarantine. They can be used to monitor adherence to quarantine measures or, if location information is stored, to create maps that track the virus.
• Contact tracing applications track the points of contact between infected people and others. The technology uses GPS and/or Bluetooth. GPS cross-checks the location history of infected people, while Bluetooth stores information on proximity to other phones

26 Mar 2020 - Remote working in Covid-19 pandemic will spike cyber risk, warns Zurich

24 Mar 2020 - Beazley reports 131% ransomware spike and warns Covid-19 will heighten cyber risk

20 Mar 2020 – March Reader on digital payment providers - examples from Kenya, Uganda, Pakistan, Singapore, India

25 Mar 2020 - COVID-19:Understanding the legal risk landscape

21 Apr 2020 - Swiss Re Institute highlights economic impact from COVID-19 lockdowns

Webinar

International Labor Organization Webinar – “COVID-19 and the insurance industry: Why a gender-sensitive response matters”

Reports

COVID-19 and the Insurance Industry: Why a Gender-Sensitive Response Matters (IFC)

Women at the core of the fight against COVID-19 crisis (OECD publication)

UN Women - The Economic Impact of COVID-19 on Women in Latin America and the Caribbean (link) / El Impacto económico del COVID-19 en las mujeres de América Latina y el Caribe (link)

Blogs

1 Apr 2020 - Gendering COVID-19: implications for women, peace and security

COVID-19 is increasing customers’ awareness not only of health risks but also of risks related to their ability to work. This could represent an opportunity for the insurance industry.

Recent innovations in telemedicine and a worldwide expansion in 2020 of health insurance plans covering telemedicine services stand the chance to make a lasting contribution towards the goal of universal health coverage.

Digital technology has the real potential to significantly reduce health insurance administration costs, which has long been a challenge in making comprehensive health insurance products work at scale in developing countries.

There will be an A2ii- IAIS Dialogue on Innovation, Digitalisation and Telehealth on 23 September 2021.

August 2020 - COVID-19 prompts insurers to boost healthcare innovation

7 Apr 2020 - The African Risk Capacity (ARC), a parametric sovereign disaster risk insurer for African nations, is planning to add coronavirus protection to its planned outbreaks and epidemics parametric insurance product, which it aims to have available from 2021.

3 Apr 2020 - This Insurance Would Have Helped in Coronavirus Crisis But Nobody Bought It

25 Mar 2020 - Covid-19 and corporate insurance : how to reduce your insurance budget ahead of an economic crisis? For brokers, integrating parametric insurance into the programs can be a very efficient optimization tool while facilitating the placement. (Descartes Underwriting)

Lack of health, unemployment or life insurance is a particular challenge for the millions of people who work in the informal economy. Vidya Diwakar, a Senior Research Officer at the Overseas Development Institute (ODI), notes that such workers - many of them women - may not have the luxury of staying at home without paid sick leave. “People living in or near poverty often lack disposable cash and cannot easily stockpile food. Hunger, malnutrition, pneumonia and other forms of health-related shocks and stresses compound vulnerability to the virus and contribute to a vicious cycle of disease, destitution and death. Poverty can fuel contagion, but contagion can also create or deepen impoverishment,” she says. (Microinsurance Network)

13 Apr 2020 - MAPFRE will return over $32m premium to self-employed and SME policyholders

19 Mar 2020 - The economic fall-out for micro, small and medium enterprises (MSMEs), and for the millions of low-income people who are informally employmed, will be significant. According to the Asia Business Review, business interruption (BI) insurance typically protects against losses caused by physical damage such as fire or flood - but it is unclear whether this will extend to the presence of coronavirus. In addition, micro BI insurance for low-income businesses is still in its infancy, and needs urgently to be scaled up. As with other types of microinsurance, the vulnerable are those that need it most and the sums insured are relatively small. Insurers themselves will be hard hit: “The main losers will be firms with large whole of life books but low levels of reinsurance, and there is likely to be a large amount of sum at risk for policyholders in their 50s and 60s,” notes the Review. (Microinsurance Network)

1 May 2020 - UK regulator the Financial Conduct Authority (FCA) is going to ask the courts to provide legal certainty over business interruption (BI) insurance cover for Covid-19 pandemic losses, in order to ensure customers are treated fairly.

It will obtain a court declaration based on sample cases and BI policy wordings to resolve uncertainty for SMEs that have been closed in the government-ordered lockdown. (source: Commercial Risk Online)

The FCA has also written to insurers asking them to clarify by 15 May whether their BI policy wordings cover non-property damage claims.

The pandemic has demonstrated the limitations around the extent private insurance can respond to pandemic-related losses. While some specialty polices may cover pandemic claims (see Wimbledon and the Tokyo Olympics), the vast majority do not explicitly do so. However, many insurers are also expected to broadly exclude pandemic risk going forward). Joint action from the public and private sectors can facilitate economic recovery now and for future pandemics. Examples of these at a national level are soverign natcat schemes such as ARC in Africa.

The A2ii and IAIS held a pandemic risk webinar series in 2020.

Read the blog with insights from the Pandemic Risks Dialogue.

During the A2ii’s Public webinar series on pandemic risk, the following recommendations were made for insurance supervisors:

Financial education and awareness

• Greater consumer awareness of risks, their policy coverage, and how insurance can help improve their resilience

Create an enabling regulatory environment

• Broaden distribution channels
• Explore product bundling and mandatory products

Market development

• Be aware of and enable innovative products
• Support new and innovative distribution channels

Facilitate discussions

• Use their platform to initiate discussions and access governments
• Convene stakeholders to jointly develop solutions

"Think Global, Act Local" 

• Supervisors need to engage globally and learn from peers

News and Reports

March 2021 - OECD published 'Responding to the COVID-19 and pandemic protection gap in insurance'

October 2020 - The Geneva Association published 'An Investigation into the 
Insurability of Pandemic Risk'

27 July 2020 - Insurance against pandemic risk: EIOPA identifies options for shared resilience solutions

2 July 2020 - COVID-19 and (re)insurers’ financial health

21 Apr 2020 - $500bn Pandemic Risk Insurance Act (PRIA) reinsurance program in the works (USA)

2 Apr 2020 - Reinsurers well-placed to manage COVID-19 disruption, says Willis Re

SCOR says re/insurers have expertise to understand COVID-19 impact

Forced COVID-19 payments could impact insurer stability: Sampson, APCIA

5 May 2020 - AXA XL responds to COVID-19 with remote risk assessments

1 May - Swiss Re: What will life look like in the post-COVID-19 World?

23 July 2020 - Lloyd’s creates Syndicate 1796 to insure transportation of COVID-19 vaccine

17 June 2020 - Ins­urance indus­try advo­ca­tes a pri­vate-public sec­tor pro­tec­tive shield

June 2020 - Report on Pandemic Risk Protection: Accelerate Recovery and Build Resilience Now Through Public-Private Partnership 

A2ii Public Dialogue on Public-Private Initiatives

24 Mar- cerlatam - COVID-19 y el futuro de la regulación

There is an emerging link between remittances and insurance. Both senders and receivers can face unexpected risk events that have negative effects on their livelihoods. Remittances are a form of coping mechanism for receivers, however, sender and receiver risk events have given rise to the need for appropriate coping mechanisms and forms of protection. Insurance through remittance channels unlocks the potential to build resilience by opening up greater formal remittance flows as well as increasing the insurance uptake to help close the risk protection gap.

On 30 June 2020, Cenfri and AXA Emerging Customers presented their research and work on remittances and remittance-linked insurance products during the A2ii-IAIS Public Dialogue.

2 July 2020 - COVID-19 and (re)insurers’ financial health

21 Apr 2020 - $500bn Pandemic Risk Insurance Act (PRIA) reinsurance program in the works (USA)

2 Apr 2020 - Reinsurers well-placed to manage COVID-19 disruption, says Willis Re

SCOR says re/insurers have expertise to understand COVID-19 impact

Forced COVID-19 payments could impact insurer stability: Sampson, APCIA

5 May 2020 - AXA XL responds to COVID-19 with remote risk assessments