Page 19 - Insurance Times August 2020

against job losses – given the strong Deblina Mitra, Insurance Analyst at adapt their policies accordingly, says
growth of the unadvised channel in GlobalData, comments: “Allianz does GlobalData, a leading data and
recent years.” have a diverse business portfolio. How- analytics company.
It is estimated that more than half of ever, life insurance accounted for According to a poll by GlobalData, 27%
all income protection products sold around 50% in 2018, which leaves it of respondents want to work from
open to capital market vulnerabilities
provide unemployment cover. Accord- home permanently post-COVID-19,
ing to GlobalData’s 2019 UK Insurance in 2020. Low investment margin and while 46% would prefer a mix of home
Consumer Survey, 56.1% of consumers increased deferred acquisition costs and office working and 27% of respon-
adversely impacted the insurer’s oper-
purchasing income protection bought dents wanted to return to the office
policies providing cover against redun- ating profits, which fell by 25.2% in Q1 full time. With such a large proportion
dancy – either unemployment insur- 2020. of individuals wanting to work remotely
ance or comprehensive income protec- Mitra, continues: “Event cancellation either full time or partially, it looks that
tion. The latter, in addition to provid- and business interruption are expected the changes in risks will remain in the
ing unemployment cover, also pro- to record the largest portion of claims long-term.
vides protection if the policyholder demand due to the pandemic. A rise
Yasha Kuruvilla, Insurance Analyst at
becomes incapacitated to work be- in the number of lawsuits against the GlobalData, comments: “With people
cause of sickness or an accident. insurer by business seeking claims un- spending more time in the house, the
der business in the US and UK, as well
Benito adds: “On a more positive note, risk of accidental damage has in-
GlobalData anticipates that the in- as the judgement of these cases, could creased. According to Zurich, claims
come protection market will bounce set a precedent. for flat-screen TVs have increased by
back in 2021 and sustain growth to “However, Allianz is well set digitally to 22% since lockdown began, and acci-
2024 as the impact of the pandemic is deal with the current environment. It dental damage to glass increased by
left behind. COVID-19 will trigger ap- is deploying its existing online platform 57%."
petite for income protection products to support clients and drive sales, par-
Moreover, many homes will not have
in the medium to longer term and ticularly in regions with lockdown re- suitable workstations, increasing the
raise awareness of the benefits they strictions. It has also focused its invest-
provide. In addition, individuals will ments in Insurtech, and has developed risk of ergonomic and postural injuries.
Working from home will limit social in-
become warier about unprecedented other digital platforms such as mobile
events and will rethink how best to apps - MyHealth and Allianz Notify - for teractions, putting increased strain on
protect themselves against them. online claims settlement.” employees’ mental health. The indus-
try is already reacting to this - for ex-
These factors are expected to contrib-
ample, Chubb has launched Work from
ute to future growth of the income COVID-19 will see insurers
protection market.” Home insurance for the Asia Pacific
adapt polices as risks region that includes cover for postural
Allianz’s exposure to busi- change strains and injuries, as well as mental
ness interruption and COVID-19 has forced many people to health support.
Kuruvilla continues: “Once the risks
event cancelation lines work from home. In many ways, this
has reduced some risks - for example associated with remote working be-
could be costly fewer people will be a victim of theft come clearer, more insurers will re-
Allianz’s dependency on Europe and or burglary, and household damage lease products to cater to this grow-
risky products, as well as life insurance, such as burst pipes and leaking appli- ing group of individuals so that busi-
impacts the company’s short-term ances will be reduced, which can hold nesses can keep their employees
growth prospects. Europe accounted the highest cost to home insurers. healthy and well protected. Home in-
for 75% of Allianz’s total business in However, the transition to working surance premiums will also be af-
2018. It is skewed towards Germany from home has led to concerns in other fected. However, insurers will need
and Italy, which accounted for over areas such as physical and mental more data to ascertain whether the
half of its total insurance business that health, which were not originally cov- decreased cost of theft and escape of
year, according to GlobalData, a lead- ered in household policies. As everyday water outweighs the increased costs of
ing data and analytics company. risks change, insurers will have to home accidents.” T

The Insurance Times, August 2020 19