Insurance companies create services for an era when the pandemic is the new normal, and businesses and individuals barely manage to pay for the basic services.
The insurance packages organizations can buy in 2021 may be more expensive than those they purchased in the previous years. Still, they offer security against disruptions like the pandemic and prevent losses if another similar situation emerges. The insurance industry encourages brokers and insurers to develop upgraded solutions to support the customers in case of apocalyptic-like issues like nuclear explosions and virus outbreaks. If before the pandemic, insurance services addressed more mundane issues like car accidents, personal injuries, house damage, or health issues, in 2021, we expect to see products inspired by dystopian movies. Insurance providers aim for policies that provide people with relief during lockdowns. They create coverages that pay businesses when they experience an interruption in their activity, no matter the reason. It's a major change because the post-COVID world won't anything like the pre-pandemic one. For entrepreneurs working in the hospitality sector, these packages are life-saving because they are at the point where they made it to the tenth round of the fight with the pandemic, and they're barely holding on when a new punch comes from nowhere. However, the hospitality industry isn't the only one struggling, all niches are dealing with issues, and a new range of insurance services could help them stay afloat.
The latest insurance products are meant to fill the void on the American business scene
The government's exemptions helped most insurance providers emerge out of 2020 unscathed, and the industry is ready to create programs that provide virus cover, even if some insurers that targeted events removed pandemic from their coverage because they registered high losses.
But the virus outbreak has highlighted that the sector lacks adequate insurance at affordable prices, and therefore most organizations choose to skip it because they don't afford to purchase it, even it is pivotal for businesses operating in the hospitality or entertainment industries. To fill the market's void, some insurers started selling contingency policies that insure organizations against social distancing effects.
With the number of home deliveries growing, some companies have hired individual drivers to meet the demand, but they hit a bump when they couldn't find commercial auto insurance packages for individual contractors that use their own cars to deliver the products businesses provide. However, in 2021 some insurance providers created policies based on the car's usage that allow them to get typical commercial car insurance at affordable prices if they deliver products for companies affected by the pandemic. Experts consider that even after the pandemic, last-mile delivery will stay popular, and the auto insurance sector needs to address the changing needs. Once everything comes back to normal, websites like Insuranks.com will register high traffic because drivers will want to compare auto insurance offers to estimate how much their policies will cost and what they cover.
Insurers are ready to develop bespoke covers for organizations
Because organizations are only now understanding how a pandemic can affect them, insurers have to adapt to the situation and be ready to offer their clients custom-made solutions. In 2021 each company seems to have unique needs, and insurers must find a way to address these specific requirements. They are offering COVID outbreak relapse coverages that support businesses when they face repetitive shutdowns. The policies are created around the buyer's specific needs and pay when the particular conditions are met.
The insurance industry has created special packages for the entertainment industry that also took a hit because of the pandemic. The coverage providers that target the entertainment sector added to their portfolios policies that pay when a cast member catches the virus, and the shooting process is forced to pause.
However, bespoke policies don't come at average prices, some of them exceed $100,000, and those created for the entertainment industry can even reach million of dollars.
What other trends should we expect to see in the insurance industry?
Unforeseen national and global events can affect the business world, and insurers must find a way to adapt to the changing scenario. Many insurers are spotting opportunities that allow them to align their goals with the market's needs and start new trends. Here are the ones we expect to witness in the following months.
A growth in wellness and health products
As expected, the virus outbreak has pushed the health and wellness sectors to their limits, and insurers have to respond to the surging number of requests for medical and life policies that include digital and wellness services. The carriers that quickly develop a range of services to meet these new requirements can establish a strong presence in the market and stand out against the competition.
Insurance companies diversify their service portfolio
2020 marked advancement in the tech world, and with state-of-art digital services at hand, the insurance industry is presented with new opportunities that allow them to expand their services beyond their traditional list. We expect insurers to partner with companies from other industries to provide complex services.
Niche insurance products grow in popularity
In 2020 insurance providers launched a number of risk-management services that allowed their clients to deal with the COVID-19 pandemic's effects. They had to answer to the growing demand for covers that target pandemic-related issues, cyber-threats, event-cancellations, and the inability to continue the business. The interest for bespoke solutions will mark 2021, and niche products will shine, allowing creators to make a statement on the market.
Well-established brands will grow
Insurance providers that afford to develop innovative solutions and experiment with new services will enjoy the benefits and attract substantial clients. Traditional carriers are expected to get out of their shells and explore new products if they want to strengthen their position on the market. Giant insurers will use their financial strength and resources to face the advanced economic conditions the pandemic caused and secure new opportunities. The industry will most probably see multiple acquisitions and mergers in the following months.
Functioning in impossible-to-predict conditions is the new normal for insurers, and they are ready to come up with schemes that meet even the most unimaginable situations.