December 18, 2020 by Adam Malik
Deemed an essential service, most tech-savvy brokerages deftly pivoted to a remote workforce model when COVID shut down the economy in March. Necessity became the mother of invention. The pandemic ignited the brokers’ rapid transition to paperless processes, enabling delivery of uninterrupted client service through a largely remote workforce.
Brokerages are now re-thinking how and where their staff will work, not only through the second wave of the virus but also in the long term. Virtual meeting technologies like Microsoft Teams, Zoom and WebEx helped restore a sense of community and collaboration for staff who work from home, while reducing travel costs. Although IT expenditures may have increased for brokerages that wisely deployed corporately-owned devices to employees and invested in improved network security, brokerages can reduce their occupancy costs post-pandemic. This requires adapting our methods of training, supervision, mentoring, regulatory oversight, and network management of employees who continue to work remotely.
The challenging pre-pandemic market conditions persist due to poor industry results, weather events and catastrophes that continue to put pressure on insurers’ bottom line. Brokers struggle to fill capacity shortfalls for property and excess/umbrella liability layers at any price. They face increasingly restricted underwriting appetites while at the same time bearing the brunt of clients’ ‘sticker shock’ reactions to dramatic premium increases during an economic downturn. If Ontario’s proposed COVID immunity legislation becomes reality, insurers and reinsurers might be less skittish about covering risks arising from the virus.
Experienced brokers are finding creative solutions for clients by improving clients’ risk management protocols; subscribing risks; property layering; and exploring clients’ various risk assumption models. With cyberattacks and bankruptcies on the rise, brokers now have an opportunity to offer credit and cyber insurance solutions to their clientele.