An updated analysis suggests that monthly COVID-19-related business interruption (BI) losses for US businesses with fewer than 500 employees could range as high as $668 billion per month. Those numbers dwarf the premiums for commercial property risks in the key insurance lines which are estimated at $4.5 billion per month.
While property-casualty insurers continue to view cyber insurance as an attractive growth opportunity, economic fallout from the COVID-19 pandemic will test the US cyber insurance market, according to Fitch Ratings. The economic fallout from COVID-19 will likely affect recent premium revenue trends and the industry's claims experience.
Faced with a hardening insurance market, owners of multifamily housing properties are now working through renewals that bring sharp increases in rates, larger deductibles, and a decrease in capacity. When addressing all these factors, owners are starting to think more about self-insuring these risks.
For all the challenges the COVID-19 pandemic is presenting to businesses, the insurance industry, and society, like other crises before it the pandemic might ultimately create opportunities for captive insurance. A recent Strategic Risk Solutions webinar titled "Captive Insurance Response to a Pandemic" explored this topic.
Potential business interruption (BI) loss estimates from the COVID-19 pandemic dwarf previous insurance industry "black swan" scenarios such as two Hurricane Katrinas in a single month. BI losses from the current pandemic would be nearer to five Katrinas in a month, according to an insurance industry economist.