Clyde & Co : The future of insurance Australia

Executive summary :

Around the world, restrictions that were put in place to contain the spread of coronavirus (COVID-19) have started to relax. For many businesses, including insurers, the focus has shifted from dealing with the immediate crisis to considering how to transform operations, risk management, customer demands and employee safety for the ‘new normal’.

The Australian insurance is already under close regulatory scrutiny 

Disruption brings opportunities

Clyde & Co have surveyed our most senior clients at local and international insurers and intermediaries to understand what implications lie ahead for the insurance industry.

The insurance industry is not immune to the challenges arising from COVID-19, including disruption to traditional methods of consumer engagement and revenue streams.

However, mass disruption brings opportunity – insurers planning for the recovery from COVID-19 should focus on building consumer confidence and consider exploring alternative or unconventional channels to engage with consumers in the post COVID-19 world. This will assist insurers in demonstrating value to consumers and may provide a competitive advantage during the recovery phase.

Australian insurance under scrutiny

In Australia, the insurance sector was already under the regulatory microscope before the outbreak of COVID-19.

However, the widespread impact of COVID-19 has certainly tested the social contract between insurers and their customers, which gives regulators a different lens through which to scrutinise the sector.

In the current pandemic context, the value of insurance and the role played by insurers in society is being increasingly questioned by customers and regulators protecting customer interests, which may lead to unprecedented levels of regulatory intervention and supervision of the sector.

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