Page 19 - The Insurance Times May 2021

Ms. Shrivastav concludes: “The uniform the main consequences of the Amrita Sheela, Insurance Analyst at
clauses set by the regulator will pandemic was that it forced people GlobalData, comments: “Malaysian life
provide more confidence to the and businesses to operate solely online. insurance industry is driven by retail
policyholders when purchasing a new This therefore posed a risk to the consumer segment, which accounted
product, as the risk of being deprived broker channel, and increased the for over 90% of total premiums in
will be lower. This will benefit insurers pressure for these direct channels to 2020Indonesia. The economic
in generating new business premiums strengthen. Fortunately, the success of slowdown and uncertainty triggered by
and in retaining customers.” this new online operation in fact the COVID-19 pandemic restricted
allowed insurers the opportunity to consumer spending and impacted life
UK brokers believe COVID- reach their customers directly with insurance business. As a result, life
ease, which was particularly beneficial insurance industry grew by 4% in 2020
19 has strengthened for personal and small business lines.” against 9% growth registered in 2019.”
customer relationships However, the pandemic has exposed New business premiums declined by
The COVID-19 pandemic forced some lack of understanding from people 3.2% in 2020, compared to 14.15%
businesses to operate solely online, and and businesses as to exactly what they growth in 2019. This was mainly due
this has had a more positive impact on were insured for. There have been to the lockdown restrictions in the first
brokers in the UK than was previously disputes between insurers and small half of 2020. The gradual opening of
expected. The success of this new businesses over business interruption economic activities and increased
online operation provided insurers with payouts, for example. This should digitization helped recovery in the
the opportunity to reach their benefit brokers greatly, as businesses of second half of 2020.
customers directly with ease, which all sizes will be scarred by the pandemic Premium income from renewals, on
was particularly beneficial for personal and will want to ensure they are the other hand, increased by 6.32% in
and small business lines. UK brokers covered if a similar situation arises again. 2020, compared to 7.49% in 2019.
are boasting stronger relationships as Renewals in 2020 were supported by
a result and are in contact with Carey-Evans adds: “The need for benefits offered by insurers such as
insurers more now compared to pre- expertise and advice looks likely to discounts on premiums and extension
pandemic, finds GlobalData, a leading increase as businesses return to on premium renewal dates, helping
data and analytics company. normality, and that is backed up by just customers continue their insurance
under half (49.4%) of brokers’
GlobalData’s 2021 UK Commercial coverage during the pandemic.
customers enquiring about gaps in
Brokers Survey found that over half their cover.” Furthermore, increased awareness
(52%) of respondents stated they and COVID-19 assistance offered by
contacted customers more often now Life insurance industry in life insurance policies encouraged
than prior to the pandemic. Just under policyholders to renew their policies.
half (47.8%) believed their relationships Malaysia to reach The recent measures announced by the
with customers had strengthened US$15.7bn in 2025 government in 2021 budget allowing
because of the pandemic, while only withdrawal of Employees' Provident
17% believed it had deteriorated for The life insurance industry in Malaysia Fund to purchase life and critical illness
this reason. Furthermore, 49.4% of is projected to grow from MYR50.70bn cover and introduction of ‘Perlindungan
brokers said their clients were more (US$11.98bn) in 2020 to MYR65.86bn Tenang’ voucher program providing
interested in learning about coverage (US$15.68bn) in 2025, in terms of gross simple and affordable microinsurance
gaps since the pandemic. This will be written premium, according to products to low-income groups are
particularly encouraging for insurers GlobalData, a leading data and expected to support demand for life
looking to grow business after a tough analytics company. insurance policies.
2020, as customers are expressing GlobalData has revised Malaysia’s Ms Sheela concludes: “Malaysian life
interest in expanding coverage. insurance forecast in the aftermath of insurers have been successful in
Ben Carey-Evans, Insurance Analyst at COVID-19 outbreak. As per the latest mitigating the impact of COVID-19 by
GlobalData, comments: “This is data, Malaysian life insurance industry tailoring policies and offering flexibility
extremely encouraging data for is expected to grow at a compounded to customers. This, along with policy
brokers, who would have had to work annual growth rate (CAGR) of 5.38% support from the government, will
really hard at client relationships between 2020 and 2025, due to the help drive the adoption of life insurance
throughout a very trying 2020. One of gradual economic recovery. in the country.” T

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