Australian insurers fret over pandemic's effects on employees: study

47% have reported a rise in mental health issues.

More than half (52%) of Australian insurers agonise over the effects of the pandemic on their employees, as 79% believe that their businesses will be directly hit, according to a report by law firm Clyde & Co.

Almost half (47%) have reported an increase in mental health issues amongst their employees as they are simultaneously worried about job security and grappling with prolonged social isolation. The pandemic has also raised concerns about physical injury amongst the staff, with ergonomics and domestic violence as the main drivers.
These impacts can be traced to the industry’s lack of plans for such a sudden disruption, the report said. All office-based environments will likely continue their work from home setups and the usual hot-desk order will be reversed, it added.

In addition, eight out of 10 (79%) are worried about a decline in consumer confidence which may result in lower premium revenue. Moreover, 63% believe that the pandemic would lead to more legal and regulatory oversight on the industry.

An increase in first party policy claim costs arising from COVID-19 (26%) is expected to be the most critical issue that insurers will face in the next 12 months, ahead of balance sheet solvency (21%), third party liability claim costs (21%) and indirect claims (16%).

“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.” Clyde & Co said.