GLOBAL SCENARIO OF INSURANCE INDUSTRY

The coronavirus pandemic has taken toll over the world in both personal and professional lives. All the businesses both big and small had to change their way of operations. Several employees got laid off and many businesses declared bankruptcy. The hospitality industry got hit the most – throwing people out of business and drastically reducing their profits in just a couple of months. The IT industry saw profits as every business was forced to go from just brick and mortar to websites and social networking platforms. One industry that people and even the companies started relying more on during these tough times was the insurance industry. 

Here, we look at 2 of the Big Four accounting firms (KPMG and Deloitte) and their take on how the coronavirus pandemic has affected the insurance industry and what measures should be taken by them to sustain these tough times.

According to KPMG and Deloitte, the insurance industry was well prepared and responded better to the implications caused by the COVID 19. It was understood at the beginning that COVID 19 wasn’t around for a few months but might even last for a couple of years so the new ways of operating has allowed for the industry to learn and adapt quickly. However, a lot of work has yet to be done and many improvements have yet to be made. These improvements 

While all the companies have adapted to work from home, KPMG has pushed forward the ideology of remote work in the insurance industry and built what they call the “Talent Risk Framework” that will help the companies to manage the workforce effectively that will yield business results. It states the 5C’s and the questions revolving around these terms. 

Capacity:

Are there sufficient resources in the right locations, and are they equipped to do what you need them to do?

Capability:

What are the key skills and capabilities required to ensure your workforce operates effectively on a sustained basis?

Connectivity:

How will teams stay connected, motivated and engaged in this new and emerging environment?

Cost:

How much will the workforce cost to run as you ensure business continuity?

Compliance:

What are the regulatory implications of remote working for an extended period?

It has further stated that the problem with the insurance industry has less to do with technological issues and more with manpower issues as they prefer more one-to-one meetings to make decisions. Thus, the key lies in mastering the work through remote platforms and virtual meetings to get the work done. 

Deloitte focuses on the matter and jots down the key questions whose answers would be the unlock to working in an effective way and improving in the value delivery.

Key questions executives and boards should be asking

  •     What safeguards do we need to put in place and support for the safety of our own people and distribution partners in the agent/broker community?
  •     How do we enable and sustain effective alternative work arrangements for employees? How do we ensure that we continuously improve virtual work-place productivity?
  •     How do we best bolster operational load implications with respect to increased levels of customer enquiry and the increased level of support and counsel they may require?
  •     Does our existing cybersecurity armory afford us sufficient protection under significantly increased load and new modes of working and exchanging information?

The insurance industry is worth billions of dollars both in the United States and India. Insurance leaders from all over the world at Ernst and Young have projected growth of the insurance industry in different regions of the world till 2040 in their report. But times like these dawn upon us and shifting the way as the needs change will help this industry grow further. 

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