The Journal CII - Aug/Sept 2020

thejournal.cii.co.uk August – September 2020

OPPORTUNITY UNLOCKED Rebuilding public trust in a post-Covid world Changing tack What next for travel insurance postcoronavirus?

Diversity dividend The profession acts to improve diversity and inclusion

The new PPI? Could Covid-19 compensation be the next mis-selling scandal?

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It’s OK to show off.

Corporate Chartered status is a visible sign of your commitment to professionalism.

Be recognised for your achievements. Be Chartered.

Speak to our Corporate Chartered support team to ďŹ nd out more on 0208 9898464 or visit www.cii.co.uk/chartered CII.08.2020.002.indd 2

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AUGUST - SEPTEMBER 2020

C O N T E N TS 38

NEWS 5 President’s letter Nick Turner on how the profession can emerge from the pandemic better prepared

27-29 Travel The evolution of travel cover as restrictions are lifted 30-31 Claims Dealing with the coronavirus claims surge

6 -11 News UK and international news from the CII

32-33 Policy mis-selling Could Covid-19 compensation claims be the next PPI?

12-13 Regional news News from the local institutes

36-37 Marketing A concerning increase in misleading social media advertising

23 Regulatory radar The latest legislation updates from the UK

FEATURES

40-41 Flexible working Has the insurance sector adapted to long-term remote working?

14-15 The Interview We meet the founders of the African-Caribbean Insurance Network

43 Societies How each sector has continued to support members during lockdown

16-19 Diversity and inclusion An overview of how the profession is turning D&I discussion into action

STUDY ROOM

20-22 Public Trust Index Examining the results of the latest CII survey 24-26 Capitalisation How insurers look to overcome the tough economic backdrop

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49 Q&A The big 10 questions to test your knowledge 50 CII blog Being proactive around diversity and inclusion in our workplace 50 CEO comment A look ahead with Sian Fisher

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32 CONTACT US

The Chartered Insurance Institute 21 Lombard Street, London, EC3V 9AH Tel: (020) 8989 8464 Fax: (020) 8530 3052

The Journal is the official magazine of the Chartered Insurance Institute (CII).

Views expressed by contributors or advertisers are not necessarily those of the CII or the editorial team. The CII will accept no responsibility for any loss occasioned to any person acting or refraining from action as a result of the material included in this publication.

Chief executive: executive: Sian Sian Fisher Fisher

The Journal is online at www.thejournal.cii.co.uk

Editor: Luke Holloway Communications director: (020) 7417 Emma Ann4778 Hughes luke.holloway@cii.co.uk Editor: Luke Holloway Contributing editor: Liz Booth luke.holloway@cii.co.uk Contributing editor: Liz Booth Art editor: Yvey Bailey Picture editor: Art editor: YveyClaire BaileyEchavarry Production: Jane Easterman Picture editor: Claire Echavarry Printing: GD Jane Web Off set Production: Easterman Printing: GD Web Offset

Cover Image: Ikon Getty

your magazine’s plastic– wrap RecycleRecycle your magazine’s plastic wrap check– check your localfacilities LDPE facilities to fihow nd out how your local LDPE to find out

Publisher: Redactive Media Group Level 5, 78 Chamber Street London E1 8BL Tel: (020) 7880 6200 For sales and advertising please contact us on cii-sales@redactive.co.uk or 020 78807880 76617661 020 ISSN 0957 4883 © 2020 2020 Chartered Chartered Insurance Insurance Institute.

Institute. © Average total total net net circulation circulation more more Average than 82,000 82,000 than

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CII to hold its first virtual Annual General Meeting This year, we are delighted to host our first fully virtual AGM on 8 October 2020.

No matter where in the world, our members will be able to attend, vote, and ask questions at this year’s AGM. We hope the virtual AGM will allow us to connect with more of our members and ensure they remain at the heart of our decision making.

Look out for more information on the CII website and an email with joining instructions from Lumi, our AGM service provider.

We look forward to welcoming you to our first fully virtual AGM! www.cii.co.uk

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PRESIDENT'S LETTER NICK TURNER

LESSONS TO BE LEARNED In his final letter for The Journal as president, Nick Turner looks at what the profession can take forward from its response to Covid-19

One year on and we clearly still have work to do.

On the financial services side of the profession, the issue of unsuitable final salary pension scheme transfers looms large and, on the general insurance side, the damage done to the reputation of the profession from business interruption policies not triggering when customers thought they should be covered will rumble on for some time.

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WITHOUT OUR SERVICES WE WOULD BE LESS ENTREPRENEURIAL AS A WORLD AND LIVE FAR MORE DANGEROUS LIVES – WE OFFER THE WORLD A POWERFUL SOCIAL INSTRUMENT

his is the president’s letter that I did not expect to be writing – holidays, work patterns and even annual general meetings have been disrupted by the onset of Covid-19.

I have extended my term of office by three months or so, to coincide with revised dates for the AGM, and formally hand over the presidency to Julie Page, and recognise the new chair of the CII board, Helen Phillips.

The CII is incredibly fortunate to have both Julie and Helen’s advice and wise counsel to draw on as we emerge from a very challenging period for UK and world economies. There will be lots to do and plenty of change to work through.

My presidential year has focused on the individual actions that we can all take, every day, to build trust within our profession.

I have been lucky enough to present at local institute dinners all over the UK and talk about how benevolence, integrity, competence and predictability all combine to improve trust between insurance and financial services professionals and customers.

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OUR DUTY

These issues cast a shadow over the fantastic good that our professions do every single day. We often have to remind ourselves, and the media, that we pay out billions in claims every year without complaint, efficiently and carefully indemnifying our customers. We should remember that our support often helps avoid financial disaster, our risk management saves lives and our financial advice protects families, businesses and futures.

Without our services we would be less entrepreneurial as a world and live far more dangerous lives – we offer the world a powerful social instrument.

To my mind it is with that purpose, that we have a duty to go back over these recent events and define for ourselves what could we have done better – did we demonstrate benevolence, competence, predictability and integrity? Because in there somewhere is the solution to make sure that next time around we are better prepared, better able to fulfil our purpose and better able to avoid a repeat of the challenges we are having to face today. ● Nick Turner is president of the CII

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NEWS

FROM THE CII TWITTERATI »

@ c rawc o Technical excellence is at the heart of our response when the worst happens so we were delighted to learn that @CIIGroup has awarded Mike Clementson with an Outstanding Service Award

@yu tre e i n s u ran c e Yutree has successfully renewed its @CIIGroup status for another year. We’ll continue to provide solutions relevant to our customers’ needs, maintaining our knowledge through qualifications & ongoing professional development

@ C l a i m s S o c i et y The new edition of the SOCP magazine is out now! Click below to read our latest features on how motor, travel, business interruption and COVID-19 are affecting the claims sector

AWARDS

CII RECOGNISES TOP-PERFORMING PROFESSIONALS

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The CII has awarded 34 prizes for the exceptional completion of the professional body’s qualifications in 2019.

The CII examination prizes, which have been handed out annually since the professional body was formed in 1912, are given to candidates who achieved the highest performance in their exam sittings and were judged to have produced the greatest standard of coursework.

Entry for these prizes is automatic for every CII candidate who completes a test or submits coursework during the year.

Every winner receives between £100 and £1,000 plus a certificate, which is usually presented to them at their local institute dinner, handed out by the sponsor of the category or sent directly to them if

they prefer.

This year, given the government’s guidance to slow the spread of the coronavirus, the CII will send the

certificates to the winners’ homes but still wants to celebrate their achievements. So, in the coming weeks the professional body will recognise their efforts via the CII’s social media accounts.

The CII will post photos of the winners with their tips on how they managed to achieve their performance and what the awards mean for their career.

Among this year’s winners were insurance and personal finance professionals from St James’s Place, Smart Pension, Willis Towers Watson, Mazars, Marsh, NFU Mutual, Amlin, LV and Aviva. → To learn more about the awards, visit: cii.co.uk/qualifications-awards

CHARTERED INSURANCE INSTITUTE

CII BECOMES COMMONWEALTH ACCREDITED MEMBER The CII has become an accredited member of the Commonwealth, joining the category of Professional and Civil Society Organisations.

The CII has committed to the Commonwealth’s 16 values and principles, which include a strong focus on gender equality and facilitating access to the profession for people from all backgrounds.

Queen Elizabeth II, who is the patron of the CII, has also acted as the head of the Commonwealth for more than 40 years.

Other values and principles held by the Commonwealth include commitments to democracy, human rights, tolerance

and respect, freedom of expression, good governance, and protection of the environment.

Sian Fisher, CEO of the CII, said: “As an international professional body, we wanted to commit to the shared set of values championed by the Commonwealth.

Also, out of respect for the many years of commitment from our patron, Her Majesty the Queen, and now her successor, Prince Charles.

“We are proud to be an accredited member of the Commonwealth and will work with other organisations towards a Commonwealth that utilises its strengths, pursues the common interests of its members, and seizes the opportunity to help them and others to shape a better world.”

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NEWS

@THM a rc hB i z Steven Clemence, Chartered Financial Planner at TH March and Fellow of the Personal Finance Society (FPFS) has received the CII 2020 Distinguished Award, in recognition of service to the insurance industry and the CIIs

@A k r i v i s W Great conversation with a newly qualified adviser through the @CIIGroup connect e-mentoring.

Exciting times for younger industry entrants

@JakeBumfluff Superb service from @CIIGroup this morning, very impressed

#CIIGroup Twitter

18,578 Followers and counting...

AWARDS

CII APPLAUDS PROFESSIONALS RAISING STANDARDS

Members of the insurance and personal finance profession who have shown leadership qualities and worked to raise standards in the last 12 months have won CII 2020 Awards.

Earlier this year, the CII asked members of the profession to nominate individuals whose work with the CII’s local and affiliate

institutes and/or contribution to their local community was raising standards in the profession. The awards, which are an annual event, are sponsored by Aviva.

A panel of judges consisting of representatives from the CII and its various societies then reviewed the nominations to decide who should receive a trophy and a certificate of accomplishment.

This year, the Allan Bridgewater Medal for an outstanding achievement that benefits the wider insurance profession went to Husain Al Ajmi, managing director of The Foundation for Insurance and Finance Education Limited.

The Emerging Professional of the Year award went to Dionne Wall, mortgage adviser at Financial Options.

The Distinguished Award in recognition of service to the insurance profession and the CII went to: David Oram, technical head office class underwriter at NFU; Hannah Kate Smith, chief of staff at Lloyd’s; Christopher Henley, head of wording at Tokio Marine Kiln; Steven Clemence, director and financial planner at T H March & Co; and Charlotte Watts, associate director of energy and mining at Aon Singapore.

Juliet Halfacre, senior business developer at Allianz Engineering, and Michael Kevin Clementson, head of agriculture at Crawford & Co Adjusters, picked up the Outstanding Award.

Dr Christianah Bola Onigbogi, CEO of CBO Insurance Brokers, received the Exceptional Award.

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CHARITY

FUNDING FOR TRAINING AVAILABLE FOR PROFESSIONALS HIT BY COVID-19 The CII’s Education and Training Trust has given £25,000 to the Insurance Charities, to ensure about 100 professionals suffering financial hardship as a result of Covid-19 can obtain qualifications to improve their future employment prospects.

On behalf of the CII’s Education and Training Trust, The Insurance Charities will administer applications for the full funding of training and reimburse eligible applicants for the costs of learning upon provision of a receipt from a relevant education provider.

Applicants do not need to be members of the CII to request funding for their learning and development, but they must

have worked in insurance and wish to complete studies to further their career in the profession.

For those who do not qualify for the scheme, the CII will continue to offer a

20% discount on digital learning materials available for both members and nonmembers who as a result of Covid-19 were furloughed or have seen a material reduction in their income.

This discount applies where the individual’s learning costs were not funded or subsidised by their employer.

Those who are interested in applying should contact customersupport@ cii.co.uk, detailing their personal circumstances. The CII’s customer support team will provide guidance on how to redeem a discount voucher. → For more information, visit: www.theinsurancecharities.org.uk

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NEWS

PUBLIC CONSUMER

CII EDUCATES CONSUMERS ABOUT CHARTERED FIRMS The CII is launching a campaign designed to raise awareness among consumers of what they can expect from companies that achieve Chartered status.

Chartered status is a symbol of technical competence and signifies a public commitment to professional standards.

Between August and the end of October, advertorials will appear in Chamber of Commerce magazines, Institute of Chartered Accountants in England and Wales publications, the Law Society Gazette and Money Week.

The advertorial campaign was produced in response to calls from members of the

CII for the professional body to invest in promoting Chartered and increase awareness of how financial advisers and

insurance firms achieving this status benefits consumers.

The advertorial campaign, which cost £24,000, is the latest in a series of actions taken by the CII to educate the public about what they can expect from Chartered firms.

As well as advertorials, in the next few months ‘Choose Chartered’ adverts will appear online and on social media.

The latest advertorial and advertising campaign comes after the CII launched a web and social media advertising campaign in October 2019, with advertisements appearing online on the websites of publications including the Daily Mail.

E D U CAT I O N

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CII AND UNIVERSITY OF BOLTON LAUNCH MBA IN ISLAMIC FINANCE The CII and Islamic Insurance Association of London have worked with the University of Bolton to launch an MBA in Islamic Finance (Executive).

The part-time two-year graduate degree focuses on management and commerce, with the aim of helping insurance professionals progress into senior positions in organisations that follow Islamic principles.

Applicants for the MBA need at least two years’ relevant work experience and a UK honours degree, postgraduate degree or equivalent.

The MBA will ensure professionals develop a comprehensive knowledge of methodologies and concepts of Islamic Law, as well as the application of legal principals within Islamic business transactions.

Students will be taught how to assess unique issues associated with Islamic financial products and operations, and

to identify risk elements and mitigating techniques relating to Islamic banking.

A Masters-level dissertation must be submitted to achieve the MBA.

Max Taylor, chair of the Islamic Insurance Association of London, said: “We are extremely pleased to have played our part in the creation of this MBA, which will provide a recognised qualification in an ever more important area of the global risk and insurance profession.

“The involvement of the University of Bolton and the CII ensures that this course will set the standard for a qualification that we believe will be recognised and valued by employers across the profession.

“We very much hope this will be seen as an attractive opportunity for students across the world to utilise the MBA in their efforts to pursue a career within Islamic insurance and it forms a significant part of the Islamic Insurance Association of London’s efforts to create the foundations for the establishment of Shariah-compliant capacity within the London market.”

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NEWS

TRUST

CII URGES ACTION TO RESTORE TRUST The CII has revealed actions insurers can take to restore trust in the insurance profession, as small and medium-sized business are becoming increasingly concerned about policy exclusions.

While the UK was in lockdown to slow the spread of the coronavirus in April, the CII’s Public Trust Index surveyed 1,000 consumers and 1,000 small businesses from across the UK, asking them to share whether the insurance profession was performing as they expected.

The poll showed small and medium-sized firms that had experienced little financial impact due to coronavirus restrictions were still focused on the same issues as before lockdown – most importantly, renewal pricing.

SMEs that had been somewhat impacted

CHARTERED

by coronavirus were concerned about how the policy had been explained to them – levels of transparency and the quality of advice they have been given.

Businesses that had been significantly impacted by coronavirus reported that they wanted immediate assistance around their claim and to know that the policy was going to address their needs.

SMEs worst affected by coronavirus restrictions reported concerns around the transparency of their policy, stating they wanted more “clarity of language” so they knew how and when they could make their claim.

Read our article on the latest CII Public Trust Index on page 20.

E D U CAT I O N

CII TO CHECK IMPACT OF CHARTERED FIRMS’ DIVERSITY POLICIES The CII has committed to making sure the diversity and inclusion policies that Chartered firms have in place are making a positive difference to the makeup of the profession.

Last summer, the CII unveiled five actions it would take to ensure Corporate Chartered status is modern, relevant and diverse; and to ensure Chartered firms have a positive social impact and contribute to the development of the wider profession.

One of the five actions saw the CII introduce a requirement for Chartered firms to have a diversity and inclusion policy from July 2019 onwards.

To assist insurance and financial advice firms, the CII issued guidance on what approaches businesses could take to establish an inclusive culture that leads to fair outcomes and promotes respect and equality. More than 900 Chartered firms that seek to retain their Chartered status in 2020 have confirmed they will have a

diversity and inclusion policy in place by the end of this year.

To make sure these policies are delivering positive change for the profession and wider society, the CII has today confirmed that from 2021, it will request examples of the impact the approaches are having on Chartered firms when they wish to renew their status. → To find out more, visit: www.cii.co.uk/94132

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CII TEAMS UP WITH UEA The CII has joined forces with the University of East Anglia (UEA) for students looking to develop a career in the insurance and personal finance profession. From September 2020 onwards, the Norwich Business School’s undergraduate and postgraduate students in finance will only have to pay an academic rate to study for CII qualifications.

The academic rate is around a third of the amount charged to employed insurance and personal finance professionals for the same CII qualifications and professional CII membership will also be given to students for the duration of their studies.

Membership of the CII gives members access to local institute networking events, mentoring schemes and career support.

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I N T E R N AT I O N A L N E W S

HONG KONG

DIVE IN 2020 TO GO AHEAD The CII is proud to be a global festival partner for this year’s Dive In, the festival for diversity and inclusion in insurance.

As the profession enters a decade of exponential change, demanding more global innovation and collaboration than ever previously experienced, we reflect on the aspects of diversity and inclusion that enable us to bring our whole selves and our unique experiences to bear on our shared challenges.

In 2020, Dive In events will be spread across three days on 22-24 September, in 33 countries and regions worldwide. The Dive In Hong Kong event will be held on 22 September and the theme will be ‘Mental Health and Wellbeing in the Workplace’. → Registration for the Dive In Hong Kong event opens on 30 July via the website: www.diveinfestival.com

HONG KONG

CHINA

HKU SPACE OPEN DAY

CII SHARES VIEWS ON THE FUTURE OF FINANCIAL PLANNING

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Kenny Siu, regional director, Hong Kong and Asia-Pacific at the CII, supported the HKU SPACE open day on 27 June, by facilitating a sharing session on the topic, ‘Challenges and opportunities brought by the pandemic to the insurance industry’.

During the session, Mr Siu interviewed the session guest speaker Marty Lui, associate director (long-term business) at the Hong Kong Insurance Authority, about the regulator’s views on Covid-19’s impact and the opportunities ahead.

Keith Richards, CEO of the Personal Finance Society and managing director for engagement at the CII, was interviewed by the NextGen Planners for their YouTube live broadcast event on 23 June.

Mr Richards shared his views on the future of financial planning in Hong Kong and mainland China from the perspective of a professional body.

NextGen Planners is a membership organisation focused on supporting the financial planning community and offering best practice for young financial planners.

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I N T E R N AT I O N A L N E W S

ASIA PACIFIC

CII LAUNCHES NEW WEBSITE FOR ASIA-PACIFIC A new CII website (ciigroup. org/apac) was launched in June for the Asia-Pacific region. The website provides comprehensive information on the CII’s product and services, as well as the CII Hong Kong office’s news and events for students in the Asia-Pacific region.

The site also links to a CII Chinese-language website that serves the Chinese market. CII Hong Kong will continue enhancing its online content with local news, to deliver the best user experiences for CII members in the region.

CHINA

ASIA-PACIFIC

MEMBER TESTIMONIALS FROM CHINA

CII CONTINUES TO DELIVER FREE LEARNING WEBINARS

In June, CII’s strategic partner in China Yijiunian interviewed four elite CII members and obtained their testimonials for being a CII members in China.

The elite members also shared their views on the China insurance market and their experiences on how CII members can be

benefited from an internationally recognised professional qualification to their career in the insurance profession. → The interview articles (available only in Simplified Chinese) are now shared on CII Asia Pacific website: ciigroup.org/apac/ news-insight/insight

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ASIA PACIFIC

CII SUPPORT 5TH ASIA TRUSTED LIFE AGENT & ADVISERS AWARDS

The 5th Asia Trusted Life Agents & Advisers Awards presentation ceremony was held online on 27 July 2020.

The CII supported the event as one of the judges and during this year’s awards, a total of 14 winners from seven markets were honoured. The deserving winners edged out more than 250 nominations from 12 markets.

The CII encourages the profession to recognise outstanding professionals who have made a great contribution and will continue to support talent development for insurance and financial services.

During the Covid-19 pandemic, webinars have become a common tool for corporates and individuals to continue their learning and professional development.

Beginning in April this year, CII Hong Kong has organised a series of free webinars to serve the insurance and financial planning professions in the AsiaPacific region. Recent webinars covered the topics of life insurance, property and liability loss inspection, and environmental, social and governance issues.

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WEBINARS

REGIONAL NEWS

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SEPTEMBER

THE ART OF DISAGREEMENT → 1:00 pm – 2:00 pm The Insurance Institute of Norwich www.cii.co.uk/norwich

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SEPTEMBER

TAKING CARE OF MENTAL HEALTH DURING THE PANDEMIC → 10:00 am – 11:00 am The Insurance Institute of Luton and Hertfordshire www.cii.co.uk/luton

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SEPTEMBER

WHAT IS NEGLIGENCE? → 11:00 am – 12:00 pm The Insurance Institute of Cardiff www.cii.co.uk/cardiff

LOCAL INSTITUTES

INSTITUTES MOVE PROGRAMMES AND ENGAGEMENT ONLINE

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During the last few months, the CII has carefully monitored the impact of coronavirus on the local institute network, with the safety and wellbeing of members remaining the number one priority.

Despite recent relaxing of certain restrictions, it seems clear that various social distancing rules and altered working practices will remain in place for some considerable time.

In consideration of this, the CII has recommended that no face-to-face CPD events take place for the remainder of 2020 and annual dinners should not resume until the 2021/2022 presidential year.

We are extremely proud that our network of 56 institutes have rapidly moved towards an online digital offering for members locally. Looking at topics such as business interruption, policy working and cover extensions, which are all proving popular. A host of other learning has also been developed, such

LONDON

as advice for working from home, working with vulnerable customers and mental health – further helping CII members during this challenging period.

The local institutes look forward to the return of face-to-face events as soon as they are safe and viable. In the meantime, if you have any questions then please do not hesitate to get in touch with your local institute president. → A full list of upcoming webinars can be accessed at: www.cii.co.uk/events

LEEDS

YOU ARE ONLY ONE BOOK AWAY FROM A GOOD MOOD During the pandemic, the Insurance Institute of Leeds set up a virtual book club, which has started to meet on a regular basis.

Choosing a different theme each time, attendees can nominate a book and read out a small review with their likes and dislikes, creating a fantastic opportunity for members to take some downtime, network with new or existing contacts and brush up on their presentation skills.

@CIIGroup In this episode of the podcast we are talking about the work that the CII local institutes and societies have been doing in 2020 and how they have responded to the ongoing Covid-19 pandemic, with @MatthewHallCII and David Irvine

Leeds president, Melanie Jordan, FCII said: “I felt it was important to have this incentive in place; as a self-professed bookworm, for me reading is a chance to escape all the stresses and strains of daily life and also to learn about other peoples and cultures. I thought now was an ideal time to share this experience with our members. → For more information, visit: www.cii.co.uk/leeds

VIRTUAL YOGA

The London Institute hosted virtual yoga sessions during June and July to provide members with some space and time to focus on mental health and wellbeing.

More than 300 members attended the two Zoom sessions, which were suitable for all levels of yogis.

Yoga is an ancient form of exercise that focuses on strength, flexibility and breathing. The main components of yoga are postures (a series of movements designed to increase strength and flexibility) and breathing.

There is some evidence that regular yoga practise is beneficial for people with high blood pressure, heart disease, aches, pains,, depression and stress. → For more information, visit: www.cii.co.uk/london

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REGIONAL NEWS

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SEPTEMBER

CII EXAMINATION TECHNIQUES → 1:00 pm –4:00 pm The Insurance Institute of Bristol www.cii.co.uk/bristol

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SEPTEMBER

LINKEDIN – AN INTRODUCTION → 11:00 am – 12:00 pm The Birmingham Insurance Institute www.cii.co.uk/birmingham

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SEPTEMBER

LEADING IN A VIRTUAL ENVIRONMENT → 12:30 am – 2:00 pm The Insurance Institute of London www.cii.co.uk/london

INSTITUTE INTERVIEW

THE INSURANCE INSTITUTE OF CAMBRIDGE We recently caught up with Sarah Myerscough from our Cambridge local institute, where she has the responsibility for arranging CPD events for members across Cambridge. Ms Myerscough is an entrepreneur at heart and has more than eight years’ experience in building businesses. In the last few years, she has focused on the insurance profession, helping brokers to develop and implement strategies and processes to maximise business growth. She is also the creator of ‘The Insurance Broker Podcast’, which interviews industry professionals about business and market developments. ● How did you get involved with your local institute?

I was lucky enough to interview Kevin Hancock of Yutree for The Insurance Broker podcast and, through this, met Nick Carson, the current president of the Cambridge institute. Both have been supportive throughout my career journey. The position on the Cambridge institute council is my way of giving back and supporting the profession. ● What changes has the institute had to embrace since the onset of Covid-19?

The world has moved online and it has been incredible to see how quickly the CII has adapted to the move towards webinars. It has been interesting to see the variety of types of event you can offer through zoom and the like. We have done interactive workshops and both business skills and technical webinars. ● How have you ensured that you continue to engage with members during the pandemic?

In many ways, our engagement has increased. The Mental Health June Reboot was a fun way to engage, not just in the sessions, but between sessions with home toolkits and recordings for members. I have also noticed an increase in email conversations between sessions. I have received lots of positive feedback which is lovely to hear and incredible that people are taking the time to engage in this way. ● How have your members reacted to the move to an online local proposition?

Really well. The engagement in webinars has increased dramatically. ● What feedback have you had for your recent mental health events?

The feedback, both through CII feedback surveys and via email, has been incredible. The idea was sparked from another

Cambridge CII webinar, where I was in a Zoom chatroom with someone who was describing a difficult and lonely lockdown period. She expressed her delight at the chatrooms, which got me thinking and the idea of the Mental Health June Reboot was born. The Insurance Institute of Cambridge had already put on a mindfulness webinar to coincide with Mental Health Awareness Week in May, which has gone down well. We have now been asked to do a September ‘reunion’ for the group to see how everyone has coped throughout the summer. ● How important is opening dialogue around mental health with peers and colleagues?

We are currently living through challenging times.

It is so important to take practical steps to support people in their mental and emotional wellbeing. Now more than ever, the need for social connection is clear. We offered an hour a week for people to connect, relax and develop tools to support their wellbeing, and I am grateful for the support and encouragement all members have given each other. ● Why should members engage with their local institute?

What is on offer in terms of professional development, networking and connection through the institute is fabulous. It is like with anything – you get out what you put in. I have already learnt so much through my involvement with the CII and the wonderful people both in my institute and across the region. I would highly recommend getting involved. ● Do you envisage continuing with an online proposition going forward?

Absolutely. I think some face to face is also important but the ease for people of attending a webinar when we live in such a busy world is useful. I think a balance of both will be a good way forward.

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THE NETWORK AT A GLANCE ● ●

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56 institutes across the UK More than 850 volunteers developing your local engagement programme 1,000 CPD events every year Networking and engagement opportunities Local career guidance and support

→ For more information on YOUR local institute, visit www.cii.co.uk/local

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INTERVIEW

JUNIOR

GARBA

Mr Garba joined the TMK graduate scheme s in 2015, having previously worked his way up on the Kiln internship programme. He then join joined the cyber underwriting team within the enterprise enter risk division. Mr Garba is a keen supporter support of his local community of Lewisham.

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Vivien Berryman speaks to Junior Garba and Godwin Sosi about the work the African-Caribbean Insurance Network is doing to make the profession more diverse and inclusive

u unior Garba, cyber underwriter at Tokio Marine Kiln ((TMK), and Godwin Sosi, management liability underwriter aat Sompo International, founded the African-Caribbean Insuran Insurance Network (ACIN) in 2018 in response to personal experiences with the diversity and inclusion landscape across the insurance profession profession.

“For generations, the insurance sector has been dea dealing with significant levels of underrepresentation of black, Asi Asian and minority ethnic (BAME) individuals,” says Mr Garba. ethn “We know that just 10% of the UK insurance workforce comes from BAME backgrounds and the higher up you begin to go in aan organisation, this statistic begins to reduce quite dramatically.”

To address the profession’s diversity and inclusion issue issues, the pair formed the ACIN in 2018.

“Our initial plan to create the ACIN was very well receive received by TMK, says Mr Sosi. “They sent us to the US to attend the National Afric African-American Insurance Association conference for African-Americans ac across the globe.

Here, professionals come together to hear about diversity an and inclusion in the workplace and discuss how they can help drive it forwa forward.”

Mr Sosi explains that, on their return to the UK, they w were approached

by Lloyd’s of London. Lloyd’s offered them a gold sponso sponsorship to get the ACIN up and running.

“We had a meeting with John Neal, CEO of Lloyd’s of L London. Junior spoke about his experiences at TMK and the UK projec project developed from there,” says Mr Sosi.

CHALLENGES “We knew that the diversity and inclusion space had been gaining momentum for some time but that a lot of those con conversations had been heavily focused on gender diversity,” says Mr G Garba.

“The conversations are now beginning to expand to include broader aspects such as ethnic diversity.

“When we first started raising awareness, it was tthe first time many people had heard about these issues in the Lon London market, there was natural resistance to what we were about about,” he says.

One key challenge in the early stages was in es establishing the ACIN as a ‘safe space’ and a respected platform to give people the confidence to engage in conversations aabout the cause of diversity and inclusion issues in the pr profession.

But one year since it was formed, th the organisation is now firmly established within the insurance

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GODWIN

SOSI

Mr Sosi completed a one-year placement cement programme at Mercedes-Benz, followed by an undergraduate degree in Economics and Finance (BA Hons). Prior to his current position as assistant underwriter, nderwriter, Mr Sosi completed a two-year role as an underwriting nderwriting assistant in Chubb’s financial lines team.

profession as a forum for networking, sharing experiences nces and coming up with ways to make the sector a more attractive destination tination for BAME professionals.

Speaking of their success, Mr Garba says: “Last year,, we decided to launch the largest careers fair tour in the history of the market. Godwin and I visited about 15 universities across the country, along with our leadership team of eight people and volunteers from the he market.

“Through these careers fairs, we managed to sign up p 700 students to our network. A lot of those students are now working ng in the London market.”

FUTURE TALENT Much of the ACIN’s work is focused on helping prospective ctive students and giving them valuable insights into what a career in insurance urance looks like.

Mr Garba continues: “Off the back of those events, we have now managed to place about 10 students into permanent positions ositions on graduate schemes and on internship programmes.

“We have also been doing a lot of graduate recruitment, ent, including recruitment for one of the largest graduate schemes in the market, which is a great success for us as well.”

In 2020 and beyond, how do Mr Garba and Mr Sosi see the profession evolving in terms of racial diversity and what hat part will the ACIN play in this?

“We abide by the idea of being the change you want to see,” says Mr Sosi. “It is not an overnight job, but it starts with attracting tracting students, retaining and developing them through theirr career to make insurance a profession they can thrive in.

“One of the things that we have tried to work on is having reverse-mentoring sessions, connecting students with h insurance professionals who are not from a BAME background in order to share some of the challenges that they have experienced nced throughout their lives and careers.”

Mr Sosi concludes: “That safe space and that environment onment where you can talk about things and put things into action are what is ultimately going to drive the change within in the profession forward.”

To find out more about the ACIN, visit: theacin.co.uk uk ●

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CHANGE

PHOTO: PPHOT HHOT O TOO:: XXXXXXXXXXXXXXXXXXX XXXX XXX XXX XXX XXXXX X XXX XXX X XX XXXX XXX XXXXX XXXX X

Vivien Berryman is corporate development coordinator of the CII and founder of the CII Community Network.

Additional reporting by Bobbi Sills

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DIVERSITY CHALLENGE Emma Ann Hughes provides an update on the journey towards greater diversity and inclusion thejournal.cii.co.uk / The Journal / August - September 2020

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arly examinations of the impact of the Covid-19 pandemic quickly turned into discussions about the various forms of inequality that exist in our society.

The Black Lives Matters protests, concerns that school shutdowns deepened the socioeconomic divide in educational attainment, plus additional childcare and housework responsibility falling more on the shoulders of mothers than fathers, has renewed focus on what can be done to tackle inequalities that existed prior to Covid-19 but had further light shone on them by the pandemic.

It is vital that awareness of inequality becomes impactful action to address this issue. As the Confederation of British Industry (CBI) points out, tackling structural disparity – and increasing diversity and inclusion – in the UK is fundamental in enabling economic growth to benefit all in society.

The CBI points out that companies in the top 25% for the gender diversity of their executive team are 21% more likely to experience aboveaverage profitability than those in the bottom 25%.

For ethnic diversity, the CBI reports top-quartile companies are 33% more likely to outperform on profitability.

As CBI director-general Carolyn Fairbairn says: “The case for change is watertight – diverse companies are better companies.”

So, what has the insurance profession done in recent years to end inequality and what more needs to be done to increase diversity and inclusion?

ACTION TAKEN Back in February 2018, an Association of British Insurers (ABI) survey of member firms revealed the scale of the diversity and inclusion challenge for the profession.

Although there was a gender balance across the whole profession, four out of five executive and board roles were held by men and only 16% of employees came from black, Asian and ethnic minority (BAME) backgrounds.

Following the ABI survey, which raised greater awareness of diversity and inclusion issues in the profession, individual companies shifted into action to address why insurance had failed to attract and retain a wider talent pool.

In 2018, insurance giants Aviva and Royal London established employee networks, supported by members of their executive teams.

Aviva Communities focuses on age, gender balance, race and ethnicity, caring, disability and sexual orientation; while Royal London has four groups covering gender, ethnicity, LGBT+ and disability.

These groups allow current members of staff to suggest approaches to support the inclusion and advancement of colleagues. Both Aviva and Royal London revealed that these safe spaces for staff to discuss issues they face and to suggest solutions have already delivered positive results.

Following the establishment of the groups, Aviva introduced →

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policies to remove what the groups identified as barriers to career progression.

Aviva now has a group-wide equal parental leave policy that aims to provide a level playing field for women and men.

All new parents are entitled to take five hours of leave per week, for the first 12 weeks after returning to work following parental leave, as well as half a day of additional leave to support their child in their first day at a new school.

New fathers at Aviva in the UK have taken an average of 22 weeks’ paternity leave (five months) since the policy was introduced, compared with an average of two weeks previously.

Aviva’s UK employees with caring commitments can also take up to 10 days of pro-rated, paid leave per year, with five days of emergency leave and five days of planned leave.

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CULTURE CHANGE As well as creating spaces where colleagues can feed back their experiences and shape diversity and inclusion policy, establishing an internal culture where people can bring their whole selves to work without fear of prejudice is vital if the makeup of the profession is to change, notes Judy Parfitt, director of people at Vitality.

To achieve this, Ms Parfitt says Vitality established a learning and development programme that features training for all managers on unconscious bias, while annual training on equality, diversity and inclusion for all employees has been made mandatory.

Insurers agree that work to ensure a corporate culture that encourages diversity and inclusion at all levels is vital.

To improve diversity and inclusion at the top of the business, Aviva widened its group-wide Accelerating Leadership from the Inside Out programme, which started by focusing on women in leadership, to offer a leadership development course for employees from a BAME background.

A total of 18 colleagues from ethnic minority backgrounds started the programme in January.

Of the 170 women who have now gone through the accelerated leadership programme, 41% have subsequently been promoted or taken on a broader role with the insurer, helping to change the culture of the business across all levels.

Aviva has also partnered with two social mobility organisations – Social Mobility Foundation and Up Reach – and in 2018 started an intern programme for socially disadvantaged students to change the makeup of fresh entrants to the profession as well as those at the top of the insurance giant.

Paid internships are available across Aviva’s UK offices and in 2020 the insurer had 24 students on this programme.

During the last three years, eight permanent roles at Aviva have been offered to participants.

underlying causes of the gender pay gap and ways to reduce it.

Zurich identified two primary reasons for the gender pay gap: a) fewer women than men in senior and technical roles; and b) fewer women than men applying for senior roles at Zurich.

Analysis suggested that both these issues were due in part to those roles not being available on a part-time or flexible basis.

Steve Collinson, head of HR for Zurich UK, says: “We believe the most effective way to resolve this is to give everyone the opportunity to pursue their chosen career, regardless of their personal situation.

“This isn’t just about working mums. It could be those looking after elderly relatives or men that want or need to spend more time at home with their children.

“By giving everyone the terms they need in order to pursue their chosen career, more people will continue up the career ladder, where maybe they wouldn’t have been able to before.”

Zurich’s work resulted in a 25% increase in the number of applications from females in just the space of three months last year.

Following the initial success of work to tackle gender issues, in July Zurich announced it would also launch a programme to tackle inequality in pay and the removal of barriers for career progression for BAME employees.

Currently, 7% of Zurich’s UK employees declare themselves as belonging to an ethnic minority.

INSURERS NEED TO MAKE SURE THE APPROACHES THEY TAKE DO NOT RESULT IN MAKING IT HARDER FOR PEOPLE FROM CERTAIN BACKGROUNDS TO BE SUCCESSFUL

EXTERNAL EYES As well as opening up conversation with current staff and changing the makeup of a company at all levels, many of the insurers recognised the importance of bringing in external, independent agencies to help shape and measure the impact of the approaches they have chosen to take.

Following internal analysis of Zurich’s gender pay gap, the insurer worked with the Behavioural Insights Team, a social purpose company partowned by the Cabinet Office, Nesta and its employees, to identify the

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The business, including its Cultural Awareness Network, has partnered once again with the Behavioural Insights Team to analyse data about its ethnic minority employees to understand how Zurich attracts, recruits and promotes ethnic minority staff, as well as unravelling the causes of its ethnicity pay gap.

Zurich stated that this would lead to a series of interventions and an action plan will be published in autumn.

NEXT STEPS Capturing data, publicising progress, taking action to support career progression as well as making equality in the workplace the responsibility of all leaders and managers were recognised by all insurers as just the start of action to improve diversity and inclusion.

Jonny Briggs, global head of talent acquisition and inclusion at Aviva, says: “Our ambition is to have diversity and inclusion as a key fabric in the culture of the organisation, which we recognise takes years.”

Tulsi Naidu, CEO of Zurich UK, says: “We have more work to do to appoint more diverse candidates to our business and to better support them in their careers.”

As summed up by Lord Karan Bilimoria, president of the CBI and founder of the Cobra Beer brand, this work is essential if our profession is to thrive in the years to come.

He says: “Diversity drives better decision-making. Talented people must have the same rights and opportunities as anyone else to rise to the top of their careers, regardless of their appearance or background.

“Progress has been made through the years, but not enough, which is why it’s so important companies act as allies for change that can make a real difference.”

Simon Langley, inclusion and diversity consultant for Royal London, agrees that wider systems and processes for staff – and the consumers they serve – must be reviewed to make sure they are not

unintentionally discriminatory.

Mr Langley says insurers need to make sure the approaches they take do not result in making it harder for people from certain backgrounds to be successful or, in some instances, to even enter the profession.

Limiting graduate entry, for example, to Oxbridge Russell Group universities, may exclude people from less-advantaged socioeconomic backgrounds and in turn disproportionately impact people from certain ethnic minority backgrounds and those with disabilities, Mr Langley points out.

Royal London’s Mr Langley adds that businesses that do not take action to remove discriminatory practices internally are not only missing out on attracting top talent but could also be putting off customers from engaging with their services.

DIVERSITY AND INCLUSION IS MORE THAN ABOUT INTERNAL COMMITMENTS TO STAFF HIRING AND RETENTION. IT IS ABOUT MAKING A COMMITMENT TO THE WIDER WORLD He says: “Increasingly, customers are looking to the companies from which they purchase goods, whether that is groceries or insurance policies, to be more representative of the communities in which they operate and the customers they serve.

“Firms that do not make real, visible and lasting progress in this area face a backlash in the future.

Customers no longer make purchasing decisions purely on price – they expect to see a degree of social responsibility operating alongside great products.”

MAKING A COMMITMENT Diversity and inclusion is more than about internal commitments to staff hiring and retention. It is about making a commitment to the wider world, which was why in 2019, the CII’s Insuring Women’s Futures (IWF) initiatives encouraged members to commit to two pledges.

The IWF ‘Financial Flexible Working’ pledge requires firms to commit to helping their colleagues comprehend the long-term financial implications of flexible working.

The ‘Inclusive Customer Financial Lives’ pledge committed firms to undertaking an inclusive ‘whole-customer approach’, to get consumers to consider the impact of their life circumstances.

As Sian Fisher, CEO of the CII, points out: “Proactive approaches to better inform customers and to improve inclusive customer approaches within the profession will improve customer outcomes for all and increase society’s trust in insurance, personal finance and wider financial services.

“Policymakers and regulators are increasingly holding financial services firms to account regarding their responsibility for customer outcomes. By signing up to these Insuring Women’s Futures pledges, the profession is supporting improving women’s financial futures.” ●

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Emma Ann Hughes is communications director of the CII

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BUILDING TRUST IN A POSTCOVID WORLD Luke Holloway examines what the latest Public Trust Index survey shows about the impact coronavirus is having on engagement with the profession 20

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he most recent Public Trust Index (PTI) research from the CII shows that businesses affected by the Covid-19 pandemic are becoming more concerned about exclusions in their policies – particularly around liability and property insurance.

Although overall satisfaction with small and medium-sized enterprise (SME) policies remained the same as in the CII’s 2019 survey, with 82% satisfied, the report suggests some businesses are moving into what is known as a ‘forced trust’ position. This means they may no longer trust that their policy will protect them adequately but continue to rely on it because of a lack of other alternatives.

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In terms of individuals, the index shows that policyholders often still feel that their loyalty is not acknowledged and would like to see a benefit for staying with the same company at renewal.

As expected, consumers want claims to be settled quickly, but feedback also suggests they would like loyalty to be taken into account when calculating renewal quotes after they have made a claim.

Since 2017, the PTI has been surveying 1,000 individuals and SMEs, tracking firms that hold property, liability and motor insurance; and since 2019, the CII has also tracked SMEs’ attitudes to their insurers overall.

The expectation could have been to see public perceptions of insurance turn sharply negative. However, the overall picture has remained remarkably stable considering the situation many business and individuals have found themselves in.

The most recent research was divided into SMEs that experienced little or no impact due to Covid-19, some impact, or significant impact.

The survey results indicate that SMEs that have experienced little impact are still focused on issues that existed before lockdown – most importantly, renewal pricing.

SMEs that have been somewhat impacted are concerned about how the policy is explained to them – levels of transparency and the quality of advice they have been given.

For SMEs that have been significantly impacted by the pandemic, the response was that it is too late to worry about the quality of advice given at the point of sale. These SMEs want immediate assistance around their claim and to know that the policy is going to address their needs. Their concerns around transparency are more around clarity of language, so they know how they can make their claim.

LOCKDOWN IMPACT PTI research carried out in January and May this year was done against the backdrop of the UK entering into lockdown, causing a serious economic impact on firms across the country and the world. This was followed by considerable publicity and debate over how insurers have been handling business interruption claims from firms forced to close during the pandemic.

The research found that 87.8% of SMEs said the financial situation of their business has been somewhat or significantly impacted by the Covid-19 crisis.

Dr Matthew Connell, director of policy and public affairs at the CII, says: “The results support the idea that controversies around insurance rarely penetrate consumers’ consciousness.

It does at least suggest that the business interruption issue has not yet become strong enough to change the views of a majority of SMEs. “An important point to remember is that SMEs have had very different experiences with lockdown. Entire sectors have closed altogether, while at the other extreme some may be busier than ever.

“The CII survey found that although the vast majority of SMEs have been impacted, just under a third have been significantly impacted.”

In March, the UK government announced a business interruption loan scheme to help ease the burden on companies affected by the pandemic; however, an organisation’s turnover was required to be a minimum of £45m so it will not have applied to the vast majority of SME respondents, if any.

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SME OPPORTUNITY AFTER COVID-19 IMPACT For those significantly impacted, the biggest opportunities where insurers can improve are: to offer immediate assistance and advice in relation to claims; ensure the policy is the right level so the business can continue to trade; and make the policy documents easy to read, with minimal small print.

Significantly impacted

Theme

Statement

Importance

Performance

Opportunity score

1

Speed (claims)

I am offered immediate assistance and advice

7.73

5.35

10.11

2

Protection

The policy is of the right level to ensure my business could continue to trade

8.14

6.97

9.31

3

Ease

The policy documents are easy to read, with little or no small print

7.63

6.67

8.59

Source: CII / Institute of Customer Service

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According to Jeremy Trott, nonexecutive director of the Society of Claims Professionals, all insurers need to do more to help consumers and SMEs engage positively with the profession. “We need to ensure that we are transparent around cover and respond quickly and clearly to all enquiries – whether they are covered or not,” he says. “We also need to stay in regular dialogue around the Financial Conduct Authority test case and whether this changes the position in relation to the claim.

“Furthermore, we should be able to drive loyalty by providing an efficient and effective claims service that goes above and beyond customer expectations.”

Liz Foster, non-executive director of the Society of Insurance Broking, believes three key skills are paramount in the current climate, presenting an opportunity for insurance brokers to establish their value both to purchasers and to insurers as suppliers.

“Firstly, communication,” says Ms Foster. “Increasingly, business is being conducted by email. This can be highly cost effective but can also diminish the strength of communication and, consequently, the relationship between broker and purchaser, as well as the broker and

insurer. A telephone call, if not a visit, is going to assist in building or retaining the relationship, the trust and the confidence.

“Purchasers need to have confidence that the advice being given to them is because the professional insurance broker thoroughly understands their risk; can identify risk mitigation and/ or risk management requirements; understands the product and supplier range appropriate to protect that risk; and will make a recommendation for cover and supplier based on what is best for the purchaser and their risk.

“Finally, market understanding. The broker will also need a trusted relationship with insurers, as the suppliers and will need to be able to competently and efficiently communicate the risk, including risk mitigation and risk management features, as well as knowledge of an appropriate premium. premium.”

Ms Foster concludes: nship “The relationship oker, between broker, insurer and client ving is key to moving way the focus away from the lowest west possible price ce to a focus on the he most appropriate priate cover with the most appropriate priate insurer. Thiss will urance result in insurance

WE NEED TO ENSURE THAT WE ARE TRANSPARENT AROUND COVER AND RESPOND QUICKLY AND CLEARLY TO ALL ENQUIRIES – WHETHER THEY ARE COVERED OR NOT

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being viewed as a contract for cover rather than a commodity-based transaction.”

BUILDING TRUST At first sight, the controversy surrounding Covid-19 business interruption seems to have had little impact on SMEs’ attitudes to their own insurance arrangements. Below the surface, however, the PTI suggests that firms that are affected by coronavirus are becoming more concerned about policy exclusions; and those that are moving into what is seen as a ‘forced trust’ position do not completely trust that their insurance policy will cover them if they need to claim.

What remains a common issue for both consumers and SMEs is that they would like to be rewarded for their loyalty. This is something the profession has been discussing for some time now and needs to address.

The PTI suggests that insurers need to take a three pronged approach to three-pronged building trust, including finding better ways to address the issue of renewal pricing, improving advice processes to ensure clients understand both the insurable and non-insurable risks and reaching negotiated claims settlements wherever possible.

This three-pronged approach is most likely to build trust among the whole range of SMEs, from those that are most affected to those that are least affected. ● Luke Holloway is editor of The Journal

APPROACH TO BUILDING TRUST ● Find better ways to address the issue of renewal pricing. After almost two

years of initiatives to improve consumer trust in this area, perceptions tions are still very low. The sector is still largely addressing this issue through tweaking weaking communications with customers, rather than ensuring the experiences ences of new and existing customers are more comparable. ● Improve advice processes (and non-advised buying processes) to ensure clients understand both the insurable and non-insurable risks that at they face, and what they can do about each one. ● Reach negotiated claims settlements wherever possible. There is still scope for firms to reach agreements with clients about the level of assistance nce that they can give, and assistance given at an early stage will build more trust than compensation given at a later date.

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e have now been in the middle of a global pandemic for more than six months and the latest economic figures show that we have been experiencing an economic recession the likes of which has not been seen in generations. This now frames the difficulty many have been experiencing during this time and why the work of the insurance profession is more important than ever.

Some of the key regulatory updates announced in the last few months are: 1. Following tthe announcement earlier this year that tha Andrew Bailey had stepped down from the Financial Conduct A thority (FCA) and become governor Au Authority Ba of England, the FCA has of the Bank no ow ann now announced that Nikhil Rathi (pictu (pictured), former chief executive t London Stock Exchange, of the will become the new CEO. A link to the statement can be found here: bit.ly/3kwzugh

3. The FCA set out new or best practice guidance for firms in dealing with, or being made aware of, vulnerable customers.

The guidance is based on try consultations with industry ers and consumer stakeholders ch in July, as well as research the FCA has conducted ur itself, and focuses on four key themes: ● Recognising vulnerability lility t and understanding customers’ needs; ● The value of sympathy;; ● The importance of empowered pow o ered ower ereed er ed and and knowledgeable staff; ● Meeting vulnerable consumers’ communication needs.

Christopher Woolard, interim CEO of the FCA, speaking at the time of the policy statement, said the guidance was there to ensure “vulnerable customers were being treated fairly” and that, while many firms do excellent to support their customers, the The CII takes a look at what’s work FCA “will not hesitate to step in where new on the policy and public others do not”.

The guidance is still under affairs front this month consultation, the deadline for which is 30 September and can be found here:bit.ly/3gQN0cb

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WHAT’S ON THE RADAR?

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4. The business interruption (BI) test case in the High Court has now concluded, with the exact date of the judgment not yet known. However, Lord Justice Flaux expressed a hope that the judgment would be available by the middle of September, although he made clear that this was not a binding indication.

A link to the BI progress page can be found here: bit.ly/31H1p4A – as well as updated guidance on what considerations that should be taken into account when applying deductions of government support received by policyholders: bit.ly/3kBfc5a As always, the CII will continue to monitor regulatory changes and work with both government and regulators to sional standards are maintained. ensure professional

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2. The FCA has announced an extension of temporary guidelines for insurance and premium credit firms in dealing with customers who have suffered temporary financial impacts due to the current pandemic. The updated guidance sets out the FCA’s expectations for firms when considering the fair treatment of existing customers in financial difficulty, due to circumstances arising from coronavirus. The aim of the guidance is to prompt firms to help customers reduce the impact of temporary financial distress and ensuring they have insurance that meets their demands and needs.

Shayne Halfpenny-Ray nny-Ray is policy and public affairs adviser of the CII

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THE PERFECT STORM? The insurance profession is facing challenges from all sides as it weathers the Covid-19 crisis, as Liz Booth reports thejournal.cii.co.uk / The Journal / August - September 2020

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W

hen Covid-19 first struck, it seemed insurers might escape the worst of the battering facing businesses globally.

However, it now seems that in fact the sector is facing a triple whammy.

Recently, professional services firm EY warned that, of the 31 profit warnings from financial firms in the UK in the first four months of this year, the non-life insurance sub-sectors issued the second highest number of warnings (six).

Tom Groom, UK head of financial services transaction advisory services at EY, explains: “Covid-19 has resulted in health and economic challenges like none we have witnessed before.

The impact on households and businesses up and down the country is already profound and may have long-term ramifications for some.

No sector has been immune and we are seeing financial services firms issue profit warnings at a rate well above historic precedent.

“By and large, financial services firms entered this period in a position of capital strength, having significantly built up reserves since the last crisis. This is helping the industry weather the storm and maintain a strong base of financial stability. However, the signs of stress on some of the UK’s largest firms cannot be ignored. Financial services firms will continue to monitor the level of warnings coming from the

sectors that they lend to, invest in and insure, because what is very clear is that even the most diversified portfolios will be impacted.”

THE TRIPLE WHAMMY Firstly, claims. Back in April, the Association of British Insurers (ABI) said members were paying out more than £1.2bn in claims to support businesses and individuals affected

by Covid-19. This covers payments on business interruption (BI), travel insurance, weddings policies and cancelled school trips.

Beyond that, the thorny issue of further BI claims remains in the courts.

And then there was investment income.

Originally there was hope of a v-shaped downturn and recovery – now the experts are not so confident of a rapid bounceback. In The Impact of Covid-19 on Share Prices in the UK, authors Rachel Griffith, Peter Levell and Rebekah Stroud state: “The price index remained pretty steady in the early weeks of the crisis but saw a sharp decline in the weeks following the lockdown in northern Italy and fell to its lowest point in the week following the announcement of social distancing

IKON

NO SECTOR HAS BEEN IMMUNE AND WE ARE SEEING FINANCIAL SERVICES FIRMS ISSUE PROFIT WARNINGS AT A RATE WELL ABOVE HISTORIC PRECEDENT

in the UK (down 35% from the start of January).

“As lockdowns have steadily been eased across the world and in the UK, some of this decline has been reversed, taking the overall decline in the FTSE All—Share Index over the period to 21%.”

That is bad news for insurers relying on investment income to prop up any underwriting losses.

But finally, the great unanswered question is whether or not insurers will see premium income fall in the coming months. Insureds in many sectors have seen their incomes drop dramatically through lockdowns and even if they pick back up, their turnover this year will be down and, of course, many insurance policies are priced on the turnover sums to be insured.

Added to that, insureds may simply see cutting back on their insurance programme as sensible – they have less to insure, possibly fewer employees and they need to cut costs as much as possible to ensure their survival.

Although by early July, Swiss Re was more bullish, saying: “The insurance industry is set to overcome this year’s Covid-19-induced global economic recession. The sharpest economic contraction since the 1930s will lead to a slump in demand for insurance in 2020, more so for life products, with global premiums expected to contract

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NEW DIRECTIONS Lloyds Banking Group plans to refocus its attention on insurance, due to declining banking profits affected by Covid-19, which it hopes should improve its strong position in the UK household market. This could start a trend of increasing strength for the bancassurance channel if Lloyds is seen to be successful.

Source: GlobalData

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CA P I TA L I S AT I O N

by 6%, than for non-life covers (-0.1%). However, total premium volumes will return to pre-crisis levels in 2021.”

It does add a caveat that the recovery would be sector-specific and not across the board.

Around the world, this triple knock is impacting insurers’ confidence and increasing concerns that they will see a fall in income in the months ahead. The regulators are watching closely too.

REGULATOR VIEW

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In the UK, the Prudential Regulatory Authority (PRA) has been continuously updating financial service entities and in early June stressed that while not all its advice was directed at insurance firms, much of it applied equally to insurers as it did to the banks.

And it reiterates: “Firms are reminded to apply sound risk management practices regarding the identification of defaults. Consistent with paragraph 4.13 of SS7/18, the PRA expects firms to have a policy that sets out their definition of default events and processes to identify different types of default events or the severity of distress and likelihood of recovery for an individual asset.

“In the current circumstances, these processes may be used to distinguish between borrowers who are unable to make full payments due to direct Covid-19 related issues that can reasonably be expected to be temporary, and borrowers who are unable to make full payments due to financial difficulty that is likely to be more long term.”

PROFIT WARNINGS ● UK-listed

financial services firms have issued 31 Covid-19-related profit warnings so far in 2020, representing 17% of the FTSE financial services sector. ● More financial services profit warnings have been issued since the start of 2020 than in the whole of 2019. ● Within financial services, non-bank consumer lending showing the most signs of distress.

Source: EY

The warning is loud and clear – the regulator does not expect anyone to use Covid-19 as an excuse for not maintaining their capital requirements.

But will insurers find their regular insureds ready and able to pay for their policies? In many emerging markets, there is serious concern that the answer to that is no. Insurers are being urged by their regulators “to think outside the box” and innovate to remain attractive enough to garner premiums. Many predict a wave of mergers as insurers themselves fight for survival.

In the UK and elsewhere across Europe, the role of government is muddying the waters too. Furloughs and loans have kept firms and staff in place – as those rules change, the question is whether the companies will emerge with their business intact and in a position to bounce back. Or has the government intervention been merely delaying the inevitable?

For example, on 4 June, the UK government announced the establishment of a temporary government-backed £10bn trade credit reinsurance scheme. Since alerting the government in early April to the

challenges faced by the profession and the businesses it supports across the country, the ABI has worked with members to evidence the scale of the challenge and the importance of establishing a reinsurance scheme to ensure that the profession has the confidence to continue providing the cover needed by many sectors across the economy. ● Liz Booth is contributing editor of The Journal

AN EXAMPLE Aviva’s reaction has been just one example of what is happening more broadly. In April it took the decision not to pay its directors’ 2019 final dividends, saying: “Aviva remains well capitalised with strong liquidity. It remains too early to quantify the impact of Covid-19 on claims expenses in our life and general insurance businesses, and the potential effect of capital markets and economic trends on our results. Given the change in the economic outlook, we are reviewing all material, discretionary and project expenditure.”

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T R AV E L

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ith much of the world in lockdown and the UK government banning all but essential journeys, the travel insurance sector has faced a significant challenge in recent months. But, although cover is still evolving, the approach it took throughout the pandemic could result in a solid future for the sector.

The unprecedented nature of the pandemic meant many travel insurers were also forced into a form of lockdown. “More than 50% of insurers withdrew from the market in the middle of March, with many of them imposing a retrospective pandemic exclusion,” explains Anthony Kaye, managing director of Campbell Irvine and chair of the Association of Travel Insurance Intermediaries.

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GETTY

TRAVELLING IN THE RIGHT DIRECTION Sam Barrett asks what does the future hold for travel insurance as the world starts moving again? thejournal.cii.co.uk / The Journal / August - September 2020

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T R AV E L

While purchasing cover became tricky, with Moneysupermarket reporting that just six insurers out off about 40 being left on its portal at the he beginning of UK lockdown, there was as plenty of activity behind the scenes.

“Insurers were bombarded with claims and doing what was necessary to get people back from abroad,” says Helen Chambers, head of travel insurance at Moneysupermarket.

“This was all happening at exactly the same time they had to shift staff to working from home.”

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TIME TO TALK

SHIFTING RISKS KS

Amid all the chaos, communication proved particularly valuable. As well as working hard to ensure that policyholders understood their rights when it came to refunds for cancelled holidays, pointing them towards their holiday and credit card companies initially, insurers also rebated premiums to anyone unable to travel.

For example, at AllClear, customers were offered a cash refund orr a voucher with h a 20% uplift if they wanted to repurchase cover.

Insurers also looked at the experiences of other parts of their businesses, as Nel Mooy, head of proposition, travel el at Axa Insurance explains: “We have colleagues in China who had already gone through lockdown. This meant we could see how they had dealt with it, enabling us to implement online claims forms for all our customers and focus on getting communications out to reduce the volume of calls coming into our staff.”

After the initial shock, insurers started to gain the confidence to adjust their wordings in line with customer requirements. And, while there were only a handful to start with, Mr Kaye says that, by July, more and more Covid-19-friendly travel insurance policies were available. “The policyholder must not be travelling contrary y to Foreign & Commonwealth Office (FCO) advice, but first we saw insurers ad adding in cover for medical emergency and repatriation in the emergen event o of contracting the virus.

More recently, insurers are adding pre-departure cancellation, where someone is diagnosed with Covid-19 or they aare contacted by NHS Test and Trace due to Tes direct exposure, and some are offering curtailment cover. Where there is a choice of two policies – one with Covid-19 cover and one without – it’s only the former that is selling.”

Insurers’ caution around offering cancellation cover is understandable.

As The Journal went to press, Spain had been removed from the list of countries exempt from quarantine following a significant change in both the level and pace of coronavirus cases. Fears were mounting of a second peak in infections and insurers being hit by a second wave of claims. However, Paul Simmonds, managing director of Tangiers Insurance Services, believes that consumer behaviour might help to prevent this.

“People are nervous about travelling abroad,” he says. “If they go on holiday this year, they’ll book a week or so in advance, buying their insurance at that point too. This will potentially limit cancellation claims.”

BROADER COVER Although mainstream insurers are tentatively dipping a toe into Covid19-related cover, a market does still exist for those wanting more comprehensive cover. As an example, Battleface, which was developed by Tangiers Insurance Services, provides cover for people who want to travel anywhere, including countries the FCO advises against. “We have always covered these countries,” says Mr Simmonds. “In mid-July we also extended the cover, adding in up to £5m of cover for medical expenses caused by or resulting from Covid-19.”

Insurers are also responding ponding to changes in travel habits. ts. With more people opting for a staycation aycation this year, Staysure hass added a UK region to its annual policy.

“Demand for a UK policy is low but Covid-19 has brought attention tion to the risks,” ”

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T R AV E L

can often dog the insurance sector.

“Insurers have always struggled with consumer trust and the fact that cover was removed across several lines of insurance as soon as the pandemic was declared will represent a new low,” Mr Carey-Evans adds. “To get consumers back onside, they will need to ensure they are very upfront about what cover they provide.”

CHANGING BEHAVIOUR

says Darren Saunders, chief commercial officer at Staysure.

“If someone contracts Covid-19 and cannot travel, this gives them the reassurance that they are covered.”

GREATER CLARITY As well as adapting cover to suit needs, Ben Carey-Evans, insurance analyst at GlobalData, believes that policy wordings will become clearer so that consumers can see instantly whether pandemics are included or not. “I expect to see more tiered policies once this pandemic is over, with full coverage offered in a gold-type policy, for example,” he explains.

Taking this approach will also help to address some of the trust issues that

Covid-19 also brings some opportunities for insurers to benefit from changes in consumer habits.

Before the pandemic, travel insurance was often regarded as a last-minute purchase based predominately around price. Many didn’t bother at all, with research by Moneysupermarket in March 2019 finding that 28% of 2,000 people surveyed didn’t have any cover on their most recent trip.

There is plenty of evidence that this has changed. A spokesperson from consumer awareness initiative Travel Insurance Explained says they have seen an increase in the number of people contacting travel insurance providers to enquire about the cover available to them. This is echoed by Chris Rolland, chief executive officer at AllClear. “We have seen a lot more calls and they have been on average 20% longer,” he explains. “People want to know exactly what’s covered.

There’s been a shift from price to quality.”

This shift is shown in another Moneysupermarket survey, which examined what customers looked for when taking out cover. For the first time ever, the right cover came top, ahead of price. Ms Mooy is pleased to see this change in consumer behaviour. “It is too early to tell whether this is the new normal for consumers but it’s encouraging.

Travel insurance is a really important purchase: it can change your life if something happens and you don’t have the right cover.”

PRICE POINT Although the cost of travel insurance may be less important as consumers focus on taking out the right cover, several factors could push prices upwards.

As well as a flood of Covid19-related claims and lower sales volumes, insurers are also contemplating how any Brexit deal may affect exposure.

Without a reciprocal agreement in place with the European Union, insurers could find themselves picking up claims for medical expenses that would previously have been covered by the European Health Insurance Card.

While it is too early to predict the effect on rates, Mr Simmonds believes that market forces will keep premiums down. “Competition won’t allow premiums to increase,” he says.

“The FCA also takes a dim view of premium increases, especially where consumers aren’t getting any more for their money.”

The travel insurance sector is also very conscious of its responsibility when it comes to giving consumers the confidence to travel again. Mr Saunders says that, although Staysure has added Covid-19 cover to its policies, it has done this without having to increase premiums. “Insurers need to strike a balance between cover and price,” he adds. “We want people to be able to afford cover – it would be wrong if the cost stopped people from taking out travel insurance.” ●

PEOPLE WANT TO KNOW EXACTLY WHAT’S COVERED. THERE’S BEEN A SHIFT FROM PRICE TO QUALITY

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Sam Barrett is a freelance journalist

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CLAIMS

A STITCH IN TIME James Moorhouse explains how making a pre-emptive plan for claims surge events such as Covid-19 pays off in the long run

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W

ith nearly every person in the UK affected

by Covid-19, customers and businesses have had to turn to their insurance products for financial protection. Claims handlers are currently processing queries ranging from how business interruption policy wordings provide cover, to surges in new types of claim due to the number of people working remotely.

An increase in claims is to be expected during such an unprecedented situation. However, the variety of claims is also unique.

Not only will claims handlers need to be able to handle the volume of queries but also know how to respond properly. While it is true that no two claims are alike, the scope of the individual circumstances for each one means that pressure is at an alltime high.

PLAN AHEAD To handle an increase in claims, while continuing to maintain good customer service, claims teams should already have a plan in place so they can respond quickly. ‘Surge events’ are when a sudden incident occurs, such as a catastrophe or natural disaster, resulting in a dramatic rise in insurance claim enquiries. Other types of surge occur seasonally, such as theft claims during the Christmas period or escape-of-water claims during winter months.

While there is no single type of claim specific to Covid-19, the effect it has on the entire world means that it has a varied impact, causing many types of different claim.

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CLAIMS

separate non-urgent claims from those connected to the surge event.

An ‘event epicentre’ during a surge will also allow all employees to access and view the same information and data. This will help to create a central point of truth for all staff involved in responding and reduces the number of individual emails. Training materials for handlers can also be made available here if they are assisting in an area that is not their regular field of expertise.

A catastrophic event such as this can have a devastating effect on a customer. However, if claims handlers are also overwhelmed by the number of queries they need to process, this can cause a delay in responding, causing the customer further stress.

Circumstances can vary, but the growing volume of calls coming through could include accidental damage, fire or life claims. This is why it is important for there to be a resilient team on the other end of the telephone that can think quickly as well as provide reassurance during a stressful time.

A surge event can also impact the claims team themselves. Therefore, it is important to already have a contingency plan in place in case there are employee absences, or other factors preventing staff from handling claims, during an emergency.

To prepare for a major event, a designated ‘surge group’ should be created. This surge group should include several different teams: ● IT ● Geospatial ● Communications ● Claims ● Suppliers.

By creating such a group that incorporates relevant teams, a thorough contingency plan can be implemented that considers the impact a surge event will have across the whole firm and not just those concerned with front-line handling.

Quarterly meetings during ‘peacetime’ can allow teams to update each other with concerns and preparations.

These will become more frequent in the likelihood of, or during, an actual event taking place.

The benefit of creating a surge group means that teams can adapt quickly if they need to focus their attention elsewhere. The cross-training of certain employees will mean that extra support can be provided if more people are needed to speak to customers.

Telephone systems and access rights can also be updated so that more claims handlers can take extra calls to support the division affected. This is particularly important when needed to

ACT NOW However, insurers should not wait for a surge event to happen before taking action. By working on preventative measures, such as alerting customers on how to reduce fire risks or prevent an escape of water, insurers will help limit potential damage.

One other thing to note is that fraudsters may use the opportunity during a surge event to take advantage of claims handlers who may be slightly inexperienced or busier than usual during this period. This is why it is important to still follow claims processes thoroughly, even when needing to process multiple claims as quickly as possible. The time and resources spent on investigating fraudulent claims during busy periods also takes support away from the customers in genuine need.

As the impact of Covid-19 develops, it is important for claims handlers to remain aware and proactive so that they can respond to customers quickly and effectively.

You can read the full Good Practice Guide on surge events on the Society of Claims Professionals’ website here: www.socp.org.uk/91218 ●

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James Moorhouse is content manager of the CII

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COVID-19

COVID-19 CLAIMS CONCERNS Claims management companies are turning their attention to coronavirus-related compensation claims, warns Liz Booth

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total of £38.3bn was paid to customers who complained about the way they were sold payment protection insurance (PPI) between January 2011 and the end of 2019. Following the deadline for PPI claims being set as 29 August 2019, many started to speculate what could be the next mis-selling scandal for the financial services profession.

Warning signs are already beginning to emerge – quicker than most people are emerging from their lockdowns – that claims management companies are gearing up for claims relating to cover failing to pay out due to Covid-19 replacing the cash they made from PPI. Yaakov Smith, director of Logican Solutions, a provider of claims management software for claims management companies (CMCs) told Bdaily News: “We could see a large-scale campaign for compensation claims in a post-Covid landscape. It’s not just one or two valid insurance claims going unpaid during this crisis; it’s hundreds if not thousands.

“We won’t see the full effects until we’re on more stable ground, but once normality resumes, those dodging payouts will struggle to hide. At the moment, it’s all just white noise in the background of the Covid-19 crisis, but you can’t silence ruined businesses and out-of-pocket individuals forever.

Unless insurance companies reverse their stance soon, we’ll likely see a deluge in legal compensation claims for unpaid cover.”

A warning note indeed.

CLAIMANT LAWYER VIEW Slater & Gordon is one of the many law firms offering its services to aggrieved insureds. On its website, it says: “Many businesses felt reassured that they had an appropriate insurance policy in place, which they had taken out to protect them against future extraordinary events such as the one we all currently face. Some policies have been held for a considerable period of time, during which time the business has paid the required premiums.

“Many businesses with the benefit of these insurance policies have now been forced to make claims under them. Slater & Gordon has sadly learnt that some insurers are denying claims made under their polices. Claims are being denied despite the policy terms appearing to cover the current coronavirus pandemic and resultant lockdown.

“Not all the policies cover the current situation but if they do, the insured business would expect to receive a payout rather than their claims being denied. We’re always on the consumer’s side and contracts entered in ‘good times’ to cover defined difficulties should be honoured when those difficulties occur.”

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COVID-19

WHAT’S THE ISSUE? So, why should insurers be so concerned? Law firm Kennedys has been looking closely at what’s at stake and what the warnings are.

Chris Stubbs, head of investigation services and Martin Stockdale, partner at Kennedys, explain: “A key component of any claim mitigation strategy must have, at its heart, consideration of an employer’s duty of care. Have we got the right policies and practices in place to ensure we are able to meet our duty of care in relation to the health risks created by Covid-19?

And, should claims present themselves, will we be able to evidence those policies and practices?”

The pair previously warned, in mid-March, as the UK was reacting to the pandemic by implementing social distancing measures and advising people to work from home, claims farmers had their minds on one thing – coronavirus claims.

“We have monitored and analysed open-source information to identify how quickly professional enablers have reacted to capitalise on the pandemic and capture any resulting claims,” they said. “Analysis of limited company incorporation data between February and March from Companies House shows 45 newly incorporated limited companies that contain the words ‘corona’ or ‘Covid’ as part of their company name.”

COVID-19 PRESENTS A NEW FRONTIER FOR CLAIMS AND CLAIM BEHAVIOURS

Of these 45 companies, a significant number were incorporated on n 18 March and more than 11% of these incorporated ated companies have ve names that suggest a link ink to claims management activity, ti it iincluding: l di g ● COVID-19 Virus Compensation Limited. ● Coronavirus Claims Limited. ● Coronavirus Compensation Limited. ● Coronavirus Legal Solutions Limited. ● Coronavirus Refunds Limited.

The legal pair now say, at the time of writing, that Google Trends shows search term interest in coronavirus compensation for the UK peaked on 16 March. But they warn: “We do expect there to be a lag in Covid-19related personal injury claims, which will take various forms as new areas of duty, breach and loss are explored.

This may include disease claims against employers and the NHS.” Kennedys was already seeing coronavirus-referenced excuses for claims behaviours in traffic accident claims. As early as February, coronavirus-related reasons have been cited for not seeking any initial medical attention. For example: ● Accident date: 26 February 2020 | Claim date: 27 February 2020

GOOGLE TRENDS Search term interest in coronavirus compensation for the UK 100 00 0 755 50 0 255 Jan 20

Feb 17

Coronavirus compensation COVID-19 compensation Corona compensation

Mar 16

The claimant has been un unable to get through to GP to get an appointment for an assessment due to fo increase in calls due to inc coronavirus. cor ● Ac Accident date: 3 April 2020 | C Claim date: 6 April 2020 The clai claimant has also suffered with a headach headache but has not sought medical di l attention tt ti due to Covid-19.

EARLY SIGNS “It is easy to see Covid-19 becoming the ubiquitous excuse of the dishonest, who recognise a new and universally accepted get-out-of-jail-free card,” the lawyers warn. Examples include: ● Why didn’t you see a doctor?

Covid-19. ● Why was there a delay in responding? Covid-19. ● Why did it take so long to repair the vehicle? Covid-19. ● What are these extra cleaning charges? Covid-19.

“We are yet to see a significant move into social media advertising targeted at the public in relation to coronavirusrelated claims, but the early signs are there,” they suggest.

“We have identified a number of law firms updating their websites to include specific coronavirus compensation sections, focusing on challenging insurers whose policies are not reacting to claims.”

In third-party claims, firms are also advertising in respect of employers’ liability from contracting Covid-19 due to the failure in supplying personal protective equipment, despite there being widespread shortages.

The Kennedys lawyers conclude: “Covid-19 presents a new frontier for claims and claim behaviours.

Following declining claim numbers in areas such as motor, EL and PL personal injury, Covid-19 opens new opportunities for CMCs.” ●

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Apr 13

Liz Booth is contributing editor of The Journal Source data: Google Trends

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BROKING

I

34

n September, the Society of Insurance Broking (SIB) will mark its second birthday. This time last year, I wrote a similar article reviewing our first 12 months, but where to begin looking back at this year, one that was turned on its head halfway through?

By March, Covid-19 had already started to have a widespread impact on the broking profession and our members. It was evident immediately that the priority had to be supporting our members during a difficult time.

In an environment where so much was beyond our control, we focused on our core objectives – by providing our members with knowledge, skills and insight, we could ensure they were best equipped to navigate the challenging business environment and, crucially, achieve the best outcomes for their clients.

At the end of March, we launched our ‘Coronavirus Hub’: a destination for insurance brokers who wanted to access news, learning and CPD in one place. Two distinct areas

of interest emerged. Our members were hungry for technical knowledge, from the latest Financial Conduct Authority (FCA) updates to business interruption (BI) and the impact on motor and property.

As popular were the new professional skills our members needed to grasp quickly – working remotely, managing and motivating teams, mental health and wellbeing.

As weeks turned to months in lockdown, we started to investigate more specific issues – new customer vulnerabilities began to rapidly emerge, financial difficulties increased for millions across the UK, and scams and fraud increased, using coronavirus as an emotional lever. We investigated the implications of unoccupied commercial properties, and the obligations of the employer to a workforce based at home full-time, while also reissuing our updated Good Practice Guidance on surge events.

The BI debate began to gather pace, and we ensured our members could stay informed with different perspectives and opinions: from customer and public expectations; through to policy wordings and the FCA test case.

Depending on who you speak to and in which insurance class, we are either approaching or are already in a hard insurance market. As such, we have published learning to help members manage difficult conversations, emphasise the value of professional advice and

improve their sales and renewals. Our ‘Mastering Conversion’ webinar series was one of the most popular ever.

NEW BEGINNING As I write this in August, we begin to see a return to a world that can be considered more stable than a few months ago. We have therefore begun to look beyond the here and now, examining the long-term financial and economic impact of the pandemic and the ways it will change our ways of working. We have seen a huge increase in demand for and consumption of webinars and podcasts, while a more accessible website means members can find them more easily.

It is hard to predict how all this will turn out for the broking profession, but in the past few months many examples and conversations have only emphasised to me the importance of insurance to society – both the rewards of getting it right and the risks of getting it wrong. The value of clear professional advice to businesses and individuals is only likely to increase in the months ahead; and we will be there to ensure our members are supported on what will undoubtedly be a long road to recovery. The SIB is a professional community for insurance brokers and, to use a cliché of the pandemic, ‘now more than ever’ this is what the sector needs. ● Matt Hall is strategy and operations manager at the CII

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ADVERTISEMENT

T

he first hard market since the early 2000s has many similarities with the events that followed the shock of 9/11.

Accessible and cheap capital had sustained the soft market.

Some markets had begun to harden before 2020, however Covid-19, like the Twin Towers before it, has brought uncertainty to the financial markets and businesses alike.

These two components of capital allocation and business sentiment have driven insurers to truly focus on their underwriting results to ensure access to long-term capital financing. The ones that will succeed and outperform during this part of the hard market will be the ones that really focus on their clients.

It is in these difficult times when brokers and insurers alike can demonstrate their real value to the wider economy. Insurance is a mechanism for transferring risk from a business’s balance sheet to an insurer’s, allowing business owners to free up capital to develop and grow their businesses. This is when professional advice and knowledge comes to the fore.

Here at HDI Global SE, we recognise this need to support our clients. This means trying to engage with our clients and broker partners earlier and more intensely, to ensure that we can take care of the unexpected and foster entrepreneurship. We look to do this by focusing on three key areas…

SKILLED AND SPECIALIST We train our people to be specialists.

Brokers and clients therefore have informed and knowledgeable contact points that know their industry sectors and who can articulate the thought process around risk pricing coherently. As insurers, we should look to be clear about our decisionmaking. Clients need to know why their price has increased. Our people have insight into their business lines that can explain sector-specific claims inflation trends, loss severity hotspots

VALUABLE SUPPORT The importance of understanding client and broker needs in a hard market and risk profile overviews that are different for each and every client.

HONESTY AND OPENNESS If a client is likely to be impacted by significant pricing changes, informing the broker and client as early as possible is fundamental. Brokers add real value by bringing knowledge and understanding of their client to the underwriter, while also explaining insurer rationale. For this to truly work, that communication needs to be open and honest. This allows clients to review options, adjust budgets and plan their business for the longer term.

It is times like these that working with brokers to understand clients’ needs becomes more important than ever. Our distribution management team is well positioned to support brokers in the months and years to come.

If you would like to learn more about what HDI Global SE has to offer, please visit our website at www.hdi.global/uk or email us via enquiries@uk.hdi.global ●

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FLEXIBILITY It is not about price. Clients need options in a hard market. They can only get good options if underwriters are close to their brokers and have time. These options can include cover, capacity or deductibles. HDI Global SE encourages early engagement so we can demonstrate our entrepreneurial capabilities to help get the best terms for the client.

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ADVERTISING

TAKING THE LEAD Advisers and insurers are fighting back against underhanded insurance lead-generation tactics.

Simoney Kyriakou reports

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couple of weeks into lockdown, insurance professionals started to notice an increase in insurance adverts on social media platforms.

Many of those adverts were downright misleading, according to Dan Thut, operations director for insurance marketing agency Rocketer.

He says: “We see Facebook pages popping up regularly with noncompliant ads.

“Often these ads do not last long before they are taken down by Facebook, but during that time we hear reports of significant sums being spent on rogue lead generation, with fraudulent businesses spending about £20,000 per day on Facebook.”

It is not just the proliferation, but also the wording, as Kathryn Knowles, managing director at insurer Cura, comments: “I’ve seen adverts talking about the death of a young adult due to a car accident, which say: ‘There’s a huge chance something like this could happen to you.’

“Another says: ‘UK families are hurrying to get up to £246,753

life cover for only £10 per month.’ The first is bordering on scaremongering. The second is irresponsible to have launched during the pandemic, when many insurers started to become cautious about offering cover.”

Indeed, as the Covid-19 pandemic intensified, so did the frequency of “scaremongering” adverts, using what Roy McLoughlin, associate director for Cavendish Ware, calls “underhand and immoral tactics”.

AIG has been “tracking and tracing”

such lead-generating adverts, as part of its #KeepProtectionTidy campaign. When AIG traced the leads, the majority came from far and wide: the Seychelles, China, Panama, the US, Gibraltar and Transylvania.

Speaking at the ProtectX conference in July, Vicky Churcher, intermediary director at AIG, said: “Bad lead-generation adverts do nothing to reflect the true value of what good insurers do. There’s no

ISTOCK

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ADVERTISING

framework or regulatory control and the effects are far reaching.”

THE CONSEQUENCES According to Ms Knowles, because there is no control, brokers buy these leads and consumers end up losing out.

She says: “You have brokers buying these leads, without fully checking the credibility and ethics of where they are buying them from.

“A few brokers know exactly where these leads are coming from but are not concerned because they’re not their in-house financial promotions.”

But what is offered is not delivered by the end insurer, in most cases.

Ms Churcher says often the promises of money back or premium discounts, which lure people in, are simply “not honoured”.

Therefore, someone ends up with inappropriate insurance, or none at all, because trust has been destroyed.

Also, leads are often recycled,

meaning someone responding to an advert could be called relentlessly by many insurers.

The General Data Protection Regulation (GDPR) prevents the unauthorised use of a person’s data; but rogue operators only care that the lead buyers are paying for them. This means someone’s data could be shared with many organisations.

“A multimillion-pound GDPR breach is just around the corner if we don’t take action,” says Alain Desmier, managing director of Contact State.

He says brokers or insurers buying these leads are culpable: “The Advertising Standards Agency (ASA) is clear: the lead generator and the lead buyer are both directly liable. If you are buying fraudulent leads, you are at risk.”

POSSIBLE SOLUTIONS The nuclear solution would be a blanket ban on all such solicitation, but, as Mr McLoughlin points out, although “responsible and accurate financial advice is the preferred method, we must also acknowledge advisers are of limited numbers, so other modes have their place”.

Good advertising and responsible lead generation can help signpost people towards the right solution for their needs.

But knowing what is good and what is not can be difficult for the lay person, as Keith Richards, chief executive of the Personal Finance Society (PFS), states, which is why the PFS has recently issued a six-point plan to help clients avoid scams (see box).

One action is to report suspicious adverts, says Rocketer’s Mr Thut.

He suggests: ● Screenshot the ad you suspect of being against Facebook rules; ● Give feedback directly on the ad by clicking the three dots in the top right of the ad (this will further reduce distribution of the ad).

Mr Desmier suggests: “Become the lead. Enter your details and record

who c calls you back. Then ask to speak to the director of compliance and make them aware you intend to complain to the Financial Conduct Authority and the ASA. “Because of the nature of the complaint, the firm has a duty to make a full reply to you, describing what action they have taken. We have to enforce the rules ourselves.”

To this end, a whitepaper has been published by Contact State and Lifesearch, called Protecting the Protectors. The 11-page document outlines how by working together, legitimate lead generators, intermediaries and insurers can agree a universal system of certifying lead generation that crowds out the fraudulent element of the market.

Such a certificate also represents assurance for the customer that the lead was generated in a compliant manner and contains a rich dataset of information to support that; almost like a receipt.

Mr Desmier says: “Ultimately, every single lead should be accompanied by an independent certificate that records where and when the consumer applied, along with what they saw on that journey.”

But if lead certification is to work, the profession must work together and help stamp out bad practice. As Mr McLoughlin adds: “A collaborative effort is vital.”●

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Simoney Kyriakou is editor of Financial Adviser

SPOT THE WARNING SIGNS contact: Traditionally scammers cold call, but contact can also come from email or social media, post, word of mouth or even in person at a seminar or exhibition. ● Time pressure: They might offer you a bonus or discount if you invest before a set date, or say the opportunity is only available for a short period. ● Social proof: They may share fake reviews and claim other clients have invested or want in on the deal. ● Unrealistic returns: Fraudsters often promise tempting returns that sound too good to be true, such as much better interest rates than elsewhere. ● False authority: Using literature and websites that are hard to distinguish from the real thing, claiming to be regulated, speaking with authority on investment products. ● Flattery: Building a friendship with you to lull you into a false sense of security. ● Unexpected

Source: The Personal Finance Society ety

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FLEETS

GROUNDED Insurers face uncertainty over exposures caused by airplanes and marine vessels laying idle, writes Tim Evershed

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he Covid-19 pandemic will wipe trillions from the value of global trade this year as economic uncertainty continues, demand stalls and supply chains are disrupted.

This disruption has included the grounding of a vast number of aircraft fleets and marine vessels.

These idle fleets are creating new risks for their owners, operators and (re)insurers, including accumulations of risk at ports and airports, maintenance challenges and crew issues.

According to estimates from researchers Russell Group, global trade will fall by $3trn (£2.38trn) in 2020, compared with last year, while airline passenger numbers dropped by more than 90% in May 2020 compared with May 2019, according to the International Air Transport Association.

Consequently, there is a significant drop in shipping and aircraft movements and even the unlocking of some of the world’s economies will only provide limited relief.

CHANGING RISK Alex Stovold, head of aviation at law firm DAC Beachcroft, says: “The risks here are clear – the aggregation of valuable aircraft assets in storage, often in locations that would not ordinarily have such a risk profile, requires careful review of various issues. These include any change to ‘ground risks only’ insurance from the usual ‘flight risks’, the oversight of appropriate physical security provision, the impact on maintenance schedules of the unexpected change of aircraft and fleet use and fundamentally the contractual protection that sits behind all of these factors.

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FLEETS

“As the passenger numbers remain low, the risks facing the aircraft themselves will require continued oversight and management going forward, including from a currency and skills perspective when the aircraft are ready to take to the skies again.”

Russell Group expects the grounding of aircraft to continue to varying degrees across the global routes operated by airlines, which will vary from region to region throughout 2020, with varying levels of return to pre-Covid-19 levels for airlines during that period.

Suki Basi, CEO of Russell Group, says: “The reason why it should matter to an underwriter is concentration of exposures in a location. It increases the potential size of the event. So we are talking more about the severity as opposed to the frequency. Some of these locations where aircraft are currently located, are natural peril locations.

“Reinsurers should be more vigilant of developing exposures as airlines return to flight. Airlines are trying to retire older aircraft and some less fuel-efficient aircraft like the A380. During the return-to-flight phase, airlines want to be operational as quickly as possible, but safety restrictions will inhibit the return to pre-Covid-19 levels.

“As a result, airlines will be focusing on cashflow and trying to cut costs, trimming non-profitable routes and fleets that are expensive to run. As a consequence, (re)insurers face uncertainty over exposures during the return to flight phase and must monitor the exposure situation more regularly.”

IMAGES: GETTY

IDLE SHIPS Although many ships have remained active through the coronavirus outbreak, many other vessels have been impacted, leading to a number lying idle. A vessel is considered to be on layup when it is taken out of service and is anchored at a fixed location for a considerable period of time without undertaking any commercial activities.

THE INCREASING DISRUPTION AND ECONOMIC PRESSURES CAUSED BY THE PANDEMIC ALSO HAVE SERIOUS RISK MANAGEMENT IMPLICATIONS FOR THE MARITIME COMMUNITY AND INSURERS ALIKE If the layup of vessels is not properly managed, including regular maintenance, problems can materialise when the ship is ready to sail again. Relieving crew has become more challenging due to travel restrictions, meaning more fatigued seafarers – one of the main causes of human error on board.

Delays in the servicing and inspections of vessels and emergency equipment can result in any problems remaining undetected, while supply chain disruption means oils and consumables can take longer to arrive, which can result in machinery damage if incorrect alternatives are used. At the same time, an increase in the use of remote pilots – to protect seafarers from the risk of infection – can also have an impact on safe vessel navigation.

“The increasing disruption and economic pressures caused by the pandemic also have serious risk management implications for the

maritime community and insurers alike,” says Captain Rahul Khanna, global head of marine risk consulting at Allianz Global Corporate & Specialty.

“An unplanned layup can result in a prolonged recommissioning exercise that can last for months, even requiring docking. Comprehensive plans, including risk assessments covering storage and layup, are crucial for ensuring the safety of vessel during the downtime and its subsequent return to service,” adds Captain Khanna.

He continues: “I do not expect passengers to start booking cruises, at least this year. There may be some local operators who might be able to run cruise services under strict restrictions, but in general the global cruise industry is expected to be severely affected by the Covid-19 impact. Other vessel types have many additional variables to consider for coming out of layup, such as oil prices for tankers and macroeconomic indicators for others.

“In general, insurers should ensure they are fully aware of the exposures they face and try to understand the quality of risks that are exposed.

Initiate a constructive dialogue with the assureds to understand what steps they are taking to mitigate losses.” ●

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Tim Evershed is a freelance journalist

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W O R K I N G PAT T E R N S

E

40

ight out of 10 women want to carry on with home working in some way after the Covid-19 lockdown lifts, according to a recent survey carried out by Insurance Supper Club Group (ISC), a global business community for females in insurance.

Barbara Schonhofer, chair and founder of ISC Group, believes there will be a major shift in the way the insurance profession works – with a resulting improvement in gender balance.

The myths have been busted, agrees Claire McDonald, UK country manager for HDI Global, adding that improvements in technology have enabled these changes.

“I don’t think we will go backwards now. We moved very quickly, for example to have electronic signatures in place. We were having that conversation for years but now we have done it and we

T S

will carry on using this once we are back in our offices,” she says.

However, she does fear that some will want to rush back to the “old ways”.

“I am hearing from some of the men that they are missing the social side of the market and that they want to come back to that,” she reveals.

There is reason for optimism, however: “Where I have some hope is that I do think we will have a large proportion of people who will want to work two days a week from home and not all five days.

“If we can get both genders wanting that and also have the same demand across the age demographic,

K I R

we will see a change.

We have no credible reasons to deny that now because the technology works and we know you can work from home and deliver.”

Ms McDonald stresses: “It is only when we get both genders wanting the same thing that we will see a genuine shift in attitudes.

For example, we have already had changes in parental

G N I

ing k or ce tly w ve uran nen a s h e ins rma 9 k as th pe id-1 h d t n oo rns i ange f Cov B Liz atte n ch ult o p sio es r fes as a o pr

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W O R K I N G PAT T E R N S

E C N A

SEA CHANGE

L A B A

leave policies – younger dads want more flexible solutions around parental leave and it has taken it away from being a women-only issue.

“If we can do this with home working, then women will get a bit more of the upside.”

Diane Maxwell, former retirement commissioner in New Zealand, agrees: “If it can encompass the men as well, it will be easier.”

IMAGE: GETTY

NEW STYLE OF LEADERSHIP ISC Group’s Ms Schonhofer, however, notes: “It is not just about agile working. It is about flexibility. If you are used to command and control and being able to see people, you can relax, but Covid-19 has changed that. A new style of leadership is needed now; it has to be based on mutual respect and trust. It becomes more of a coaching style of leadership and it is about wellbeing.”

She also says that home working means a change in approach to

meetings. “On a team call it can be hard to be heard, particularly if you have a soft voice, so we all have to adjust to make sure everyone is being heard because women will often have good ideas, which are simply not being heard.”

Ms Maxwell believes remote working will also massively help those with disabilities who face issues with commuting but who could make a real contribution, as well as helping single parents facing challenges balancing childcare and work.

Other benefits for companies will also come from enabling a greener agenda, says Ms Maxwell. “If you think about the shift to the greener economy, which we want but haven’t quite found a way to deliver… the idea of fewer of us getting into the car every day. There is something very powerful about making progress in the way we operate rather than slavishly getting up in the morning and heading to work.

“However, we need people at the top to be bold, show leadership and clearly articulate why it is a good thing and how it can work.”

Ms McDonald agrees there is a need to move away from accepted social norms. “Until Covid-19 we tended to keep conversations about flexibility and home working to the moment a woman returned from maternity leave – we need to get away from that.

“This is a bit of a sea change in managing work/life balance and the talent population as a whole. The government won’t want everyone travelling at the same time so there will be an expectation for companies not to have a rigid 9am start time. It will give us that opening to have these conversations.”

Ms Maxwell agrees, adding: “For the future, we have to think: ‘What is the output from that person? I don’t care where they do it as long as we get what we need from that individual.’”

All agree, however, that not everything needs to change, rather the working environment just needs to be balanced in a different way.

As Ms McDonald says: “The one thing we missed in lockdown was the chance to meet face to face and also to check in on people. It is hard to properly focus on more than one person at a time on a Zoom call and it is hard to casually check in on everyone, in the way you would at the office. We will still need to do that in the future too.”●

41

A NEW STYLE OF LEADERSHIP IS NEEDED NOW; IT HAS TO BE BASED ON MUTUAL RESPECT AND TRUST. IT BECOMES MORE OF A COACHING STYLE OF LEADERSHIP AND IT IS ABOUT WELLBEING

Liz Booth is contributing editor of The Journal

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SOCIETIES

EVOLUTION OF THE WORKPLACE Matthew Hall reveals how the insurance Societies and Networks have been responding to changes in the way we work

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he insurance Societies and networks have continued to support our members during this challenging time. With restrictions beginning to ease, our sector-specific professional communities have begun to look ahead to the future.

Our local institute network continues to provide members with high-quality digital continuing professional development (CPD), while it has been great to see social events adapting to the virtual world, with online quizzes, virtual coffee mornings, and even yoga and mindfulness sessions.

The Society of Insurance Broking is working hard to equip our members with the skills and knowledge for the challenges ahead. A hardening market is challenging for most in insurance, but for a generation of young brokers it will be the first time they will have had to deal with it. A recent ‘sales masterclass’ webinar series focused on one of the

most fundamental skills in the sector: communication. From having difficult conversations to emphasising the value of professional advice, the series has also considered how to generate leads, win business and maintain profitable business – while maintaining high professional standards and securing the best outcomes for clients.

Meanwhile, the Society of Underwriting Professionals has been looking at how technology is shaping the sector’s response to the pandemic.

Even before coronavirus, digitalisation and automation have been a key theme for the Society and, unfortunately, this has not always been in a positive context. It has been refreshing to see some of the ways our underwriting members have adapted to provide risk assessments, including the use of drones as just one example. Of course, policy wordings and scope of cover continue to be hot topics, with demand for genuine comprehensive cover increasing. As a subject so critical to public trust, the Society will continue to explore the issues and themes around this in the months ahead.

Finally, the Society of Claims Professionals continues to consider issues around remote working. It is fair to say some organisations have faced considerable challenges in this regard, in particular large call centre operations suddenly having to deliver their services with their staff at home. A series of articles

from members of the board has looked at culture and approaches within different firms and a common thread runs through all of them – put your staff first. All will be experiencing different feelings and emotions about the situation, they will have different attitudes to risk, to the social component of their job, and different perspectives on how their productivity can be maximised. There is no one-size-fits-all approach, so it is crucial that return-to-work policies and procedures are produced in consultation with the workforce.

43

ADAPTING I, for one, am certainly looking forward to returning to the office. Coronavirus may finally banish ‘presenteeism’ culture and the adaptability we have all demonstrated during this time should be embraced and continued. However, with many different colleagues and stakeholders, success in my role is built on relationships and it feels there is only so far Zoom and Teams can take us.

A few weeks ago, I had the unusual experience of hosting an exhibition booth at a virtual broking conference.

It was enjoyable to meet lots of new members and I was able to connect with many different people. Even so, it was very hard to replicate the social aspect that a physical event provides. Perhaps then, virtual events will complement and provide an alternative to the ‘real’ thing, but never really replace them. ● Matthew Hall is strategy and operations manager of CII insurance Societies and Networks

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HOME

THERE’S NO WORKPLACE LIKE HOME With Covid-19 resulting in a surge in the number of people working from home, Bobbi Sills assesses the insurance implications

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hen the Covid-19 pandemic struck earlier this year, it sparked a homeworking boom that transported office working to kitchens and spare rooms across the UK. Thousands of businesses were left scrabbling to switch to a ‘new normal’ of remote working. But despite the easing of lockdown, working from home is still high on the agenda for many, as questions are raised about the value of the office in the post-Covid-19 era.

Almost half of UK firms have mandated homeworking during the pandemic, according to the Office for National Statistics.

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HOME

Agile working certainly provides greater flexibility for employees, but what are the implications for home insurance and does a standard home policy provide sufficient cover for homeworkers?

FLEXIBLE APPROACH

IMAGE: GETTY

In response to the outbreak, the Financial Conduct Authority (FCA) said: “We expect motor and home insurers not to reject claims because of a consumer’s understandable temporary change in how they use their vehicle and their home address.”

The UK’s financial regulator stated that it expects home insurers to cover policyholders even though their risk profile had changed, but added that customers would have to amend their cover once lockdown was lifted.

Homeworking can result in increased theft or liability risk at a property if the policyholder is storing expensive equipment, or if there are regular visitors to the property.

Sue McCall, chair of the CII’s Society of Claims Professionals, says: “We would expect the insurance profession to respond to the new normal by revising policy wordings as standard to incorporate the additional cover required

under a home contents policy and a commercial policy.”

Insurance giants Aviva, Admiral and LV= have committed to a flexible approach towards helping customers who need to work from home but whose home contents policies do not ordinarily cover additional equipment.

A spokesperson from Aviva says: “To help customers during this time, from 20 March 2020 until further notice, we are treating home office equipment as ‘contents’ under all our home products and we’d pay up to the contents sum insured for any valid claim.”

While insurers waived the need to notify them of working from home during lockdown, customers who are planning to work from home more regularly, such as once or twice a week, may still need to take action depending on who their insurer is, according to the Association of British Insurers (ABI).

Ms McCall says: “Some home contents policies cover administration duties as standard, while others exclude items used for ‘business or professional purposes’.”

Ms McCall notes that the onus should be on employers to ensure suitable cover for their own equipment, even if the equipment is being stored in an employee’s home.

In most instances, employers will cover the costs of their equipment once it leaves the office.

Ms McCall highlights that equipment is not typically covered under home insurance policies unless the individual is responsible for damage to the equipment under the terms of employment.

Ms McCall says: “Employers should look at their commercial insurance policies, to establish whether cover is broad enough to extend to phones, laptops and portable computer equipment while away from the

business address.

“This cover is not provided within most standard commercial wordings and is subject to additional premium.”

If a policyholder has bought their own new furniture or equipment for working from home, they do not need to inform their insurer; however they may have to increase their contents cover limit if the cost of the possessions will now exceed it.

The ABI further states that if customers undertake any non-clerical tasks at home, they should contact their insurer for guidance.

CLAIMS PERSPECTIVE Remote working also puts policyholders in a better position to save money on certain types of household claim, according to Helen Idle, head of household claims at AXA. Ms Idle notes that escape-of-water claims have historically been a key focus for insurance firms, which have sought to reduce the damage and cost of these claims to the customer.

Ms Idle says: “We are starting to see the frequency of these claims increase but the severity – and in turn, the cost – is not. This may be down to the fact that as people are at home, they’re able to identify leaks quicker and stop the damage getting worse and adding to the claim costs.”

Ms Idle points out that AXA saw a decline in the total number of household claims, including accidental damage claims, at the height of the lockdown in April.

But home insurance customers who are planning to work from home for a prolonged period should be aware of the increase in likelihood of accidental damage or theft, which may result in an increase in their premiums.

As the Covid-19 crisis continues to reshape the world of work, insurers must be aware that a shift in premiums and liability for home insurance customers may well be on the horizon. ●

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Bobbi Sills is communications executive of the CII

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E D U CAT I O N

IMPROVING FINANCIAL AWARENESS George Tsounias explains how the CII is delivering free financial education across the country

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he Personal Finance Society’s My Personal Finance Skills initiative delivers free financial education workshops to schools and college across the UK through a network of more than 900 members (Education Champions), who are committed to giving something back to their local community.

Workshops cover things such as staying safe from scams, moving on from school, understanding risk, future finances and the popular ‘Discover’ game. The programme was on course to reach more than 20,000 students until things were put on hold due to the ongoing Covid-19 pandemic. Since its launch in September 2019, however, the programme has delivered more than 460 financial education workshops, reaching 14,000-plus students.

FINANCIAL EDUCATION WORKSHOPS Financial education material is aimed at students aged 14-18 and workshops have been designed to fit within a typical onehour lesson.

Resources will enable Education Champions to deliver standalone workshops aimed at raising the financial competency of students. The content has been created in collaboration with Young Money, a trusted knowledge provider supporting schools and colleges for more than 15 years.

Themes covered in our first series of workshops include: ● Moving on from school – student finance, earning, tax, NI, pensions. ● My future finances – enabling students to develop their understanding of the value of everyday expenditure. ● Making decisions and risk – students gain an understanding of their attitude to risk and how this can influence financial choices they make. ● Staying safe – identifying financial scams.

This programme also includes the existing Discover Fortunes workshop, which focuses more on employability as students take on the role of financial advisers in this interactive board game that is played in teams of up to five students.

14,000

STUDENTS REACHED

460+

Furthermore, the financial education materials have received The Financial Education Quality Mark and are supported

by Money Advice Service, following assessment by an independent panel of experts, two educational experts and one financial expert.

To adapt to the current circumstances, the programme adapted its in-school material into online financial education sessions to be hosted on its website. As well as online sessions, the website hosts a student money blog and some bitesize learning videos.

From September, it is hoped that workshops will continue to take place virtually in the first instance and in school once it is safe to do so – always in line with government guidance.

We are committed to helping students have better financial awareness and providing the support to teachers who are passionate about students’ understanding of money.

To find out more, please email: george.tsounias@cii.co.uk To find out more about the initiative, visit: www.mypersonalfinanceskills.org ●

WORKSHOPS

90%+

STUDENT APPROVAL RATING

George Tsounias is relationships manager of education at the CII

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12/08/2020 09/06/2020 10:13 17:20

Q&A STUDY ROOM

This set of questions, courtesy of online CII training package Insurance Assess, will test your knowledge of topics.

Answers are at the bottom

QUESTION 1

QUESTION 4

QUESTION 7

When will business interruption insurers pay for losses under a customer's extension?

Which of these buildings is the most likely to be listed?

A A church built in 1950 now converted into a home b A farmhouse built in 1670 with original features C A modernised Georgian property originally built in 1780 D A terraced house built in 1845

Which of these office working environments, according to a 2018 survey, was shown to be more likely to cause an office worker to feel anxious or stressed because of work?

A Cubicle style b Open plan c Private office d Working from home

QUESTION 5 Which of these losses would be covered by a typical classic car policy?

A War b Riot c Civil commotion d Rebellion

In respect of business interruption insurance, what is the main role of an underwriter?

A Making decisions on acceptance and terms b Designing policy wordings c Maintaining and servicing existing business d Handling claims

QUESTION 6

QUESTION 9

Why is an annual travel insurance policy unsuitable for long-term overseas residents?

A Because annual travel insurance would be too expensive for long-term stay b Because annual travel policies usually cover only UK and European travel c Because the minimum duration of each trip covered under an annual policy is usually around 30 days d Because the maximum duration of each trip covered under an annual policy is limited, usually to around 30 days

Political violence insurance covers which of these risks?

A War between the ‘five great powers’ b Causes of loss normally excluded from property insurance c Loss arising from fire d Only political terrorism

A If damage has occurred at the insured's premises b If the insured has arranged material damage cover on the customer's premises c If damage has occurred at a customer's premises d If the supplier has arranged material damage cover at the insured's premises

QUESTION 2 By which of these means are aviation personal accident risks normally rated?

A As a rate percent on the capital sum insured b As a rate percent on the medical expenses limit c Depending on the amount of flying per week d With an in full premium based on the insured person’s age

QUESTION 3 In respect of marine insurance, what is meant by the term 'barratry'?

A It means contact with a pier b It is a term used for a vessel running aground c It means a wilful act by the master or crew d It refers to collision of the insured vessel with another vessel

YOUR SCORE » 1–3 POOR 4–6 GOOD

7–8 VERY GOOD 9-10 EXCELLENT

QUESTION 8

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QUESTION 10 What consumer protection applies to yacht and small craft insurance?

A FCA rules do not apply to marine insurance b The Marine Insurance Act overrides consumer protection c The various Merchant Shipping Acts provide consumer protection d Yacht and small craft insurance policyholders have the same consumer protection as all other insurance policyholders

ANSWERS 1C. If damage has occurred at a customer's premises then the policyholder's turnover and profit can be adversely affected.

2A. Aviation personal accident risks are normally rated as a rate on the capital sum insured.

3C. Institute Time Clauses - Hulls, clause 6.2 extends cover to include loss or damage caused by any of barratry, which means wilful acts by the master or the crew.

4B. The older and more uncommon a building, the more likely it is to be listed.

5B. Riot damage is covered by a typical classic car policy.

6D. The maximum duration provided by an annual policy is usually 30 days.

7A. Employees in office environments are more likely to

feel anxious or stressed because of work compared to those working from home.

8A. Some underwriters will undertake duties such as designing policy wordings, but their main role is risk assessment.

9B. Political violence insurance provides cover for several classes of event normally excluded in other insurances.

10D. Yachts and small craft insureds have the same consumer protection as all policyholders provided by the FCA and ICOB rules.

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CII BLOG

HANNAH MEADS

POSITIVE DIFFERENCE Hannah Meads explains what the terms ‘diversity’ and ‘inclusion’ really mean and reveals the huge benefits of a diverse and inclusive workforce

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iversity and inclusion go hand in hand, but it is important that organisations recognise the difference.

Diversity is recognising and celebrating difference, acknowledging the benefit of having a range of perspectives in the workforce, which are representative of a company’s employees and culture.

Inclusion is valuing the difference in people and enabling everyone to thrive at work. It creates an environment where everyone belongs without feeling the need to conform, where contributions matter and individuals are able to perform to their full potential, no matter their background, identity or circumstances.

It is important to recognise that diversity and inclusion are not just about allowing ‘different’ people to ‘fit in’, but require sensitivity about creating an environment where everyone is appreciated for being individual. From the surface, the concept may seem easy; however, the complications correlate with equality – which extends way beyond the workplace.

Although there is a clear emphasis on organisations to help drive cultural change, we can certainly help as individuals too. Here are some suggestions: ● Educate yourself and keep the conversation going – Being more informed or questioning

BEING MORE INFORMED OR QUESTIONING WHY THINGS ARE A CERTAIN WAY WILL NOT ONLY HELP YOU, BUT OTHERS

why things are a certain way will not only help you, but others. The continued education and discussion of sensitive inclusion issues is necessary, as change will likely not emerge from workplace initiatives alone. ● Role-model inclusive behaviours at work and at home – Challenging exclusionary practices and behaviours can be difficult and sometimes daunting.

However, by not speaking up, it can be difficult for people to understand how their actions or viewpoints may not be inclusive. ● Encourage business leaders to understand the value of diversity and inclusion – Perhaps you can join your company’s diversity and inclusion committee (or propose setting one up) to actively discuss and promote the benefits to the wider business.

Alternatively, ask to discuss the matter more regularly in your team meetings or one-to-ones. This may help senior leaders approach the situation with a new perspective and may help promote new talent, market competitiveness or ways of working.

Not only do organisations and individuals have a social responsibility to help drive change, they have so much to gain by creating a diverse and inclusive culture. What is unattractive about creating a positive environment where everyone can influence, share knowledge and have a valued perspective – with the bonus of employee satisfaction, retention and wellbeing? ● Hannah Meads is broker at Miller Insurance

UK gradually emerges from lockdown, we are all finding the best way to work in a world of social distancing. One As the U thing that strikes me is how many interviews with epidemiologists end with them saying something like, ‘I can tell you how to limit the spread of coronavirus, but I can’t tell you what the best thing is for the country: that’s about yo balancing health considerations with the wider needs of the economy and society’.

We have moved to a place of true risk management, where we must follow a course of action, knowing that we are taking risks that cannot be mitigated completely.

I have also noticed how much the language of wellbeing is being used, describing how the same event can have a widely different impact on the mental health of individuals, depending on circumstances.

For our profession, which has risk management at its heart, these developments reinforce what we were already discovering – that navigating any social change is an exercise in risk management and that often the public’s sense of wellbeing is at least as important as the more empirical metrics we have developed over the years around longevity, health and finance.

It underlines how important our expertise is to the future of the economy and wider society. ● Sian Fisher is CEO of the CII

ILLUSTRATIONS: LUKE WALLER

LOOKING AHEAD

thejournal.cii.co.uk / The Journal / August - September 2020

50_CII Blog_Aug-Sept 2020_Cll The Journal 50

17/08/2020 08:32

With your involvement, you can make a difference.

The CII’s network of 56 local Institutes creates opportunities to get involved, make an impact and inspire others.

cii.co.uk/local

Local institutes are a constant source of support, inspiration and new possibilities

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12/08/2020 10:14

It’s OK to show off.

Corporate Chartered status is a visible sign of your commitment to professionalism.

Be recognised for your achievements. Be Chartered.

Speak to our Corporate Chartered support team to ďŹ nd out more on 0208 9898464 or visit www.cii.co.uk/chartered CII.08.2020.052.indd 52

12/08/2020 10:07