Covid-19: Sustaining responsible regulatory response during the crisis
The fight against the global pandemic has imposed new dynamics for how we live, work and interact with our friends and family. We do not know what our lives will look like in the months to come, but many people will likely fall into poverty, and many businesses will not manage to bounce back. The most severely affected are vulnerable populations who face a higher personal economic risk due to a lack of savings or alternative coping strategies. They are also disproportionately more likely to be uninsured or underinsured when it comes to their healthcare, the operation of their businesses and lack any form of unemployment protection. To protect the health of the most vulnerable among us, social distancing is bringing us closer together, in solidarity. In much the same way, we as professionals must join forces and build on the existing knowledge and coordination systems to inform the insurance sector's action.
Emerging practices and mitigating measures
The global response has set new norms in the way things are done. On the regulatory side, insurance supervisors are stepping up and taking measures to mitigate the shocks and protect their populations. In both Kenya and Morocco, the supervisor has taken actions to ensure that all coronavirus-related health claims' payments would be made regardless of any pre-existing pandemic exclusion clause.
In China, digital insurance products are being rapidly launched to cover those affected by the coronavirus, ranging from medical personnel to SMEs. Seventy of the country's largest insurance groups have teamed up to offer free coverage for the people on the front lines - including medical, military and police and transportation staff. In Malaysia, life insurers are providing additional relief measures for policyholders impacted by the economic slowdown. In Costa Rica, health insurance companies have exceptionally and indefinitely eliminated the exclusions for the events of pandemic or epidemic.
People, especially the low-income, SMEs and informally employed, need to become more financially resilient. On this last point, access to responsible, good-quality insurance, that can be depended upon in times of crisis, is paramount.
We're all learning to respond to the crisis as we go along - but some lessons are already evident. We need to accelerate access to the digital economy. We need better social protection systems with governments poised to step in and tide things through if things take a turn for the worse. We need better access to healthcare and better living conditions. People, especially the low-income, SMEs and informally employed, need to become more financially resilient. On this last point, access to responsible, good-quality insurance, that can be depended upon in times of crisis, is paramount.
A new set of evidence: implications for insurance supervisors
With respect to the current pandemic, these are still relatively early days, and new evidence and practices are emerging as you read this. To help supervisors adapt to this fast-changing environment, the A2ii has re-prioritised and launched three new initiatives: the blog, a webinar series and an insurance supervisory response tracker.
With this new blog series, the A2ii brings together observations and reflections on regulatory coping mechanisms in the face of the pandemic with a focus on emerging markets. We hope to generate some valuable lessons for short and medium-term action as well as to explore positive outcomes for catalysing insurance solutions in the long-run.
In addition to the blog, to help supervisors adapt to this fast-changing environment, learn from their peers and get input from experts, the A2ii together with the International Association of Insurance Supervisors (IAIS) launched a new Webinar series on the coronavirus pandemic and implications for insurance supervisors. The first webinar took place on 2 April in English, Spanish and French, and a total of 110 supervisors from 35 different jurisdictions participated. The series continues with the second webinar planned for 16 April and the third scheduled for 30 April.
Finally, we hope that our COVID-19 – Insurance Supervisory Response Tracker will serve as a key instrument in the upcoming months for the broader community of insurance practitioners. The tracker is regularly updated with individual country interventions, useful resources and data, upcoming webinars from us and our partners and news related to COVID-19 and insurance.
On a final note, I encourage you to use these resources and let us know where knowledge or information is needed. We at A2ii hope to continue to be a source of support and resources during these uncertain times.