Matt Hall reflects on how the insurance profession has responded to the pandemic
As the strategy and operations manager for the CII, I am privileged to work with and alongside experienced professionals from across our member communities, including our sector-specific insurance societies and our local institute network. This provides me with a view of the key issues and themes that face many of our members as we move into 2021, whether they are a broker in Edinburgh, an underwriter in Birmingham, or a claims handler in London.
Whenever the world experiences disruption on the scale that the pandemic has caused, it is inevitable that the needs and expectations of our customers will change as well.
What has this meant? In a practical sense, we just need to look at the motor sector to see examples. Ongoing restrictions on social interaction and travel mean people are driving less and driving shorter distances. Business use has plummeted and road accidents have fallen dramatically.
Even when the pandemic comes to some sort of end, it’s likely these changes in behaviour will remain. The capability and normalisation of people connecting with each other virtually is likely to signal a reduction in car use, both for personal and business purposes. That is before we even consider other issues, such as the growing impact of climate change policies on car usage.
These changes in customer behaviour drive the change in expectations – why would anyone pay for thousands of miles worth of cover they won’t use? The opportunity here is in adapting to uncertainty. Many customers simply do not know what the future holds and expect products and services to reflect that in their flexibility. The Society of Claims Professionals sees the rise in pay-per-mile policies and motor telematics as almost certainly just the vanguard of an increased demand for flexible and adjustable cover across all sectors of the market.
Moreover, changing expectations go beyond the product. Social distancing measures and remote working have made face-to-face meetings and sales almost impossible for much of the population. Many members reported something of a honeymoon period last summer, with customers willing to be accommodating to organisations dealing with the same unprecedented challenges we all faced. That period is over and customers and clients expect that any adaptations are now complete; and they will be able to communicate and transact digitally with ease. Organisations that can deliver high-quality ‘at-home’ functionality and services can gain a critical commercial advantage in reaching their customers and clients.
Social distancing may have spurred many insurers to make digital a priority, but it has taught us a much more important lesson – we must put the wellbeing of our customers and colleagues first.
Many customers, whether personal or commercial, are seeking help, guidance and insight. Their own businesses may be struggling and their livelihoods may be under threat.
The Society of Insurance Broking saw many brokers becoming trusted advisers to their clients beyond the norm, helping them navigate and decode challenging and complex issues such as the business interruption test case of recent months.
Many have stepped up to support their local communities as well, as we have seen with the charitable activities of our local insurance institutes.
Looking after each other means looking after our colleagues too. The stresses and strains of busy work and family lives have been compounded by the restrictions and uncertainty of the pandemic. Research indicates that reporting of mental health concerns has risen within many employers. The response has been impressive, with many members’ organisations increasing their learning and development in this area – providing managers and colleagues with the tools to identify and respond to issues effectively. Formal training is crucial, of course, but often it has also been the seemingly smallest gestures that have had a positive impact – a virtual coffee break, or a box of chocolates sent to the home office, can make a world of difference.
It is only a once-in-a-lifetime event until the next one comes along and a reputation is only as good as how you deal with the next crisis
What we must do here is maintain momentum beyond the pandemic. Insurance, and indeed financial services more generally, can sometimes be seen as a somewhat traditional and reserved environment. Coronavirus has shown us it is okay to not be okay. It has shown us that kindness and compassion are not weaknesses in a corporate environment. There is an opportunity for members to build on this, ensuring that inclusive and supportive working environments become the norm. And of course, this comes with its own benefit: a happy and motivated workforce will be able to provide the guidance and support that our customers need.
Crucially, insurance professionals must demonstrate their empathy to customers. This does not just mean with words, but actions too. Products, services and communication channels should be designed from a starting position of caring about the customer.
There is no doubt the insurance profession faces some tough times ahead. Reduced business and customer activity in some areas has resulted in reduced sales, while claims surges in sectors such as travel and health are set against broader global economic challenges that are likely to slow growth and reduce profits during the years ahead. Reputational fallout from poor practice has the potential to gravely impact the public’s perception of insurance’s relevance and purpose. It is, as some have noted, a ‘perfect storm’.
However, these are not new challenges for the insurance profession. There will always be surge events and there will often be tough economic conditions. Achieving efficiency and commercial success is almost invariably difficult. It is only a once-in-a-lifetime event until the next one comes along and a reputation is only as good as how you deal with the next crisis.
Therefore, achieving resilience is key for both individuals and organisations to achieve sustainable success. This could be from ensuring flexibility in your business strategy and working practices. It might be through diversifying into different areas or investing in new technologies. It could mean updating crisis and continuity plans on a regular basis, ensuring regular horizon scanning.
Whether as an individual or organisation, all of that is underpinned by having the right capabilities and talent to navigate the uncharted waters. When I reflect on where I have seen our members succeed during the past year, those who have demonstrated adaptability, willingness to learn, empathy and communication skills are the ones who have stood out. At a time when the world is changing so quickly, continuing professional development has probably never been so important.
The CII’s insurance societies and networks have been crucial in supporting this success: as a professional community we have provided forums for the sharing of skills and knowledge among our members. During a year like no other, I have personally been fortunate to work with many on our advisory boards and institute councils who have been generous with their support and insight. I am convinced that we are at our most resilient when we are together – a united profession.
Since the very earliest days of insurance, our profession has a history of creating innovative approaches to old problems. If we can not only learn the lessons of the pandemic, but apply them to our future, there is a fundamental opportunity to secure the value and relevance of insurance in the eyes of the public.
Matt Hall is strategy & operations manager of the CII