May 28, 2020 by Adam Malik
Brokers may find it easier to persuade clients to buy insurance coverages that have been traditionally harder to sell, because the COVID-19 pandemic has turned a previously far-fetched risk scenario into a reality.
“It doesn’t have to be pandemic coverage we’re talking about,” Joseph Carnevale, partner and managing director of sales at Brokers Trust Insurance Group Inc., told Canadian Underwriter in an interview. “This is a much broader discussion about the exposures that businesses have, and are they making decisions for today or for the long term?”
Clients are now realizing the areas in which they didn’t have enough protection and see the cost to the entire business,” he added. “I think they’re much more in tune going forward to [cover] other types of exposures, not just pandemic.”
Now that we are all working our way through the novel coronavirus pandemic, Carnevale expects current future business owners to look at perils in a different way. “Because the ‘what ifs’ aren’t theoretical anymore,” he said. “The ‘what ifs’ can and have [happened]. I think that, in one way, is going to give this generation a much more meaningful context in which they can make decisions, which I think is good for the industry. It’s good for business.”
This in turn will make life just a bit easier for brokers. No longer do they have to sell on the ‘What if?’ scenarios, because one of them has already happened. The examples are fresh in clients’ minds. “I’m also happy in the broader sense that if more people take more precautions in protecting their businesses, that’s good for society,” Carnevale said. “It’s good for everyone.”
Cyber has been a tough sell, as Carnevale noted. He said clients have told him that, yes, they see the news reports of others getting hacked, but what are the odds that it will happen to them?
It’s certainly much more likely to happen than a global pandemic., says Carnevale. “I don’t see a line-up of people running to get cyber insurance when you provide them with the quote, which, in the grand scheme of things, is quite reasonable given the exposure.”
Businesses may ask what other coverages they should they have in place, so that they don’t end up in such a vulnerable position. As for individuals, Carnevale says, they now know the value of planning ahead and protecting themselves. “How many regular people are going about their regular lives are saying, ‘Wow, it was really good I had three months of my income socked away, because three months is pretty much what I needed to survive this?’”
Feature image by iStock.com/hodonal