Latest News: 9 COVID-19 Resources for InsurersLast updated: February 5, 2021
The COVID-19 pandemic has had significant impacts on insurance. It has impacted the economy, with large increases in unemployment and public health. Currently, in the US, more than 213,000 people have confirmed cases of the virus, and nearly 4,800 people have died from it. Today, more than 80% of Americans are under some sort of directive to stay in their homes, and we still have a few weeks to go before the “apex” of the pandemic curve. Of course, we don’t know if there will be more waves after this on subsides of what the long-term impacts on the economy will be.
The COVID-19 pandemic has reduced the efficacy of predictive models, regardless of the algorithmic approach that built them, to the point that they may now be counterproductive. COVID-19 has transformed society to an extreme extent and with remarkable speed. It has changed the economic environment, how organizations conduct their work, and have increased morbidity and mortality. Social distancing has impacted all economic sectors. How long it will last is unknown.
We’ve seen the first of what legal experts predict will be widespread litigation brought by policyholders. Companies big and small have been forced to figure out how to pay bills with no money coming in for weeks or months. While the government pledged to help with loans and financial aid, it may not be enough for many businesses to survive.
In the last few weeks, the way we work, live, and communicate has shifted entirely. Remote work is the new normal. While Argo’s digital team was able to shift to completely remote within two hours, the entire staff of more than 1500 employees took about 48 hours over one, seemingly long weekend. After that, the entire company was transitioned entirely to a remote workplace.
This is a testament to the work Argo has done over the last five years and to the flexibility of employees, who moved quickly and were transparent with their needs. This is a history-altering pandemic, and it will change the industry and businesses forever. At Argo, it has taught them a lot about what they can plan for, how digital can change the trajectory of business lines, and how at the heart of digital solutions will always be a dedicated workforce.
Auto insurers have seen something new with the COVID-19 pandemic: a historic reduction in driving due to millions of customers staying home and sheltering in place. That change led to carriers issuing between $8 billion and $10.5 billion in customer refunds, according to the Insurance Information Institute – discounts, dividends, and credits that experts say carriers can easily afford, at least for now.
The COVID-19 pandemic has not shut down the day-to-day business of adjusting claims. Still, the workload is lighter, and claims managers are coping with evolving government regulations and guidelines.
Crawford & Co. says it has added a new step into its vetting process. Each claim is reviewed by a triage specialist and assigned to the right team. When an on-site visit is requested, the company contacts the policyholder by telephone and email and asks a series of questions to evaluate the risk.
While the full financial impact of the COVID-19 pandemic is unknown, it is almost certain that there will be a negative short-term impact on IT budgets and pressure to cut costs for the entire organization.
Over the weekend, our nation’s current chief executive, President Donald Trump, waded more deliberately into yet another discussion concerning business interruption coverages in times of crisis. As reporting in Claims Journal and elsewhere, the President said that, of course, business interruption claims should be paid for COVID-19 losses. After all, businesses have paid lots of money into business interruption policies over the years, so why shouldn’t they cover the losses that have arisen in recent weeks. Only if a policy excluded “pandemic” would they be beyond reach, he opined, even acknowledging the presence of exclusions in typical insurance policies.
There’s no denying that the global pandemic has irreversibly changed the world as we know it. Social distancing, self-quarantine, and canceled events have significantly impacted the way we live, work, buy, consume, and interact. And while it’s still too early to assess the long-term effects caused by the novel COVID-19, there is one thing we know for sure: digital communication has become and will remain the new normal. So, what does this mean for insurance?
GhostDraft is Here to Help
Was this helpful?
Need more info on our Solutions?
Find out how we can help you create better experiences, greater efficiency and more agility to ensure your business is always in touch.