PWC : COVID-19 and the Insurance Industry: Issues and actions to consider
Executive summary :
The World Health Organisation declared the coronavirus (COVID-19) to be a global pandemic on March 11, 2020, escalating from a declaration of a public health emergency on January 30, 2020.
The virus has had unexpected human and economic consequences across many countries and has resulted in significant market and interest rate volatility. Along with its health impacts, the coronavirus is rapidly disrupting business and consumer activity in affected areas and beyond.
Managing the fallout
We have prepared some general guidance on COVID-19: What US business leaders should know, which addresses six key areas of focus, consisting of crisis management and response; workforce; operations and supply chain; finance and liquidity; tax and trade; and strategy and brand. Here is our take on some additional issues that insurance companies, in particular, might face. We also offer some thoughts on what you can do now to manage effectively through the uncertainty.
Volatile markets and credit spreads resulting in increased risks to access to capital, operations and profitability; Anxious customers and impact on demand/consumer behaviour; and increased reputational risk. How can you respond appropriately and stay resilient in this uncharted territory?
Operations & Technology issues
Staff and working practices; Ability to work remotely and satisfy ongoing data and operating requirements; untested recovery and continuity scenarios add to the pressure. How can you support your organisation to keep the business running as smoothly as possible?
Accounting & Finance issues
Insurance losses, capital adequacy, liquidity, impaired assets, hedging breakage and financial instrument valuation issues and need for increased disclosures. What can you do to monitor, mitigate and report on the risks and uncertainties that lie ahead?
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