Insurance and COVID-19: What it takes to deliver in a moment that really matters


With the financial markets in turmoil, it’s tempting to become internally focused. But how insurers respond to customers and societies in need of an anchor will dictate public perception for many years to come. What are the attributes that allow insurers to deliver on their purpose? 

For insurers specifically, the fallout from the COVID-19 outbreak includes a surge in health, travel and business interruption claims, pressure on sales from reduced business activity, and less use of face-to-face channels. The gathering economic slowdown emanating from the pandemic is also driving interest rates even lower and increasing credit risk exposures from businesses facing possible default. This raises the possibility of regulators asking for extraordinary solvency tests to ensure insurers can withstand the immediate and knock-on impacts. Put together, this daunting list of issues represents a stern test of resilience for an industry already weighed down by enduringly low interest rates and slow growth in mature markets. 

Our global crisis centre is currently working with a range of organisations across industries. Key concerns that are emerging for the Insurance industry include: 

Our global crisis centre is currently working with a range of organisations across industries. Key concerns that are emerging for the Insurance industry include: 

Crisis management and response

Insurers need to execute their continuity plans and continuously reassess, revise and enhance those plans on a daily basis to consider new factors as the crisis emerges.   There are seven key actions insurers, and businesses in general, can take to help protect their workers and bottom lines.  Insurers are used to working in times of others' crisis and having responsive and effective crisis plans can help them stay the course, build trust and provide solutions even when they are affected by the crisis themselves.



Insurers need to ensure that their employees have the necessary equipment, tools, working practices, access rights and technology so they can work flexibly offsite, especially with the need to minimise contact amid business and community disruptions.  Engaged supervisors maintain continuity and can keep approvals and processes moving as well as clear lines of communication and support. Stress levels may rise due to demanding customers, volatile markets and other challenges with remote working, without the supportive infrastructure and familiar working environment of the “office”.

Operations and supply chain

While face-to-face interaction has been limited by social distancing, insurers who’ve built digitally assisted distribution and sales capabilities are still able to engage with customers and service their needs. This crisis may prove to be a catalyst for product simplification and accelerating the development of direct digital channels. These digital channels will also be invaluable when the number of enquiries and claims increase and insurers need a cost-effective yet customer-friendly way to handle these requests. Directing customers to self-service channels and the automated processing of straightforward claims are proving effective.

Finance and liquidity

The volatile investment markets have the potential to challenge the solvency levels and hedging programs of insurers.  Continuous stress testing and careful monitoring is advisable.  Liquidity is rarely an issue for insurers and we do not expect significant liquidity challenges from the current environment, but movements of monies within the group could be a challenge.  And, preparing for the low to negative interest rate environment to extend ever longer than was previously forecast is something that should be top of mind for all insurers, especially those with life insurance and long tail casualty lines.  


Tax, trade and regulatory

Regulators are requesting information on forecasted solvency and liquidity levels and they need to be responded to in a timely and thorough manner.  It is unlikely that policies which exclude coverage of pandemic-related business interruption losses will be retroactively modified, but insurers are actively considering how they contribute to getting economies back on their feet and building the trust that comes with responsive actions in a moment that matters.  Using the industry´s expertise to help governments restore stability and funnel support to impacted businesses is such an opportunity. 

Strategy and brand

The true purpose of an insurer in times of crisis and stress is to provide peace of mind. It’s therefore important to devise strategies for handling this crisis from a customer and wider stakeholder perspective. From waivers of deductibles to pre-approval of claims or setting up funds for frontline employers, insurers are demonstrating their empathy. Responding to critical issues in a timely manner will be important to future customer and employee relationships. Insurers should keep close track of market developments and respond effectively and sensitively in order to demonstrate true value to the economy and society as a whole. This is also a chance to bring the exceptional ingenuity and problem-solving capabilities within the industry to the fore, such as online health consultation services.



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Contact us

Dave Stainback

Dave Stainback

Global Crisis & Resilience Co-Leader, PwC US

Tel: +1 678 419 1355

Bobbie Ramsden-Knowles

Bobbie Ramsden-Knowles

Global Crisis & Resilience Co-Leader, PwC United Kingdom

Tel: +44 (0)7483 422701

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