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Industry holds its focus during ‘unprecedented’ pandemic

The insurance industry’s focus on supporting customers and keeping clients covered during the COVID-19 crisis is a source of pride for Insurance Council of Australia (ICA) Head of Risk and Operations Karl Sullivan.

Writing on LinkedIn today, Mr Sullivan outlines what he has understood to be the five top priorities for the industry “over the last few unprecedented weeks working with [ICA members]”.

He lists the priorities as:

- Customer support – getting 252,000 disaster claims sorted, making sure that those in most need are processed with high priority and that $4.6 billion of insurance funds are injected into the community.

- Working with clients to keep them in cover to the maximum extent possible, given the financial pressures that the community is under. Mr Sullivan warns “the country is not immune to another natural disaster occurring”.

- Adjusting new policies where absolutely necessary to maintain prudential standards, including in travel, landlords, trade credit, Lenders Mortgage Insurance and SME covers.

- Keeping staff safe by working remotely and observing each state’s requirements, in many instances absorbing extra workload caused but the closure of international call centres.

- Managing the “incredible pace” of regulatory and code change that the industry faces, with stretched resources and a growing number of high priority claims to focus upon.

“The natural focus that companies have shown on No 1 and No 2 in particular, should make everyone proud to be industry members,” he says.

Meanwhile, the Global Federation of Insurance Associations (GFIA), of which ICA and the Insurance Council of New Zealand are members, has issued a statement warning against forcing insurers into paying claims despite pandemic exclusions.

It says that as the world grapples with the COVID-19 pandemic, “insurers remain focused on honouring their promises to customers”.

And it asks governments to remember that that the continued financial stability of the insurance industry is vital.

“Our industry is committed to helping governments meet the financial needs of citizens and businesses,” the statement says.

“However, where coverage for pandemics and other causes of loss were not included in existing policies or reflected in premium payments, requiring insurers to cover those losses retroactively could seriously threaten the stability of the global insurance industry.

“Events such as fires, motor vehicle accidents and natural catastrophes covered by insurance do not stop, even during a pandemic.

“As such, retroactively changing the terms of policies would not be an appropriate way to address the large-scale financial impacts of the COVID-19 pandemic.”