Opportunities in Life · health insurance companies—ratings agency Fitch has already warned that...
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8 APRIL 2020 Nine opportunities for life insurers to emerge from the crisis stronger Opportunities in Life
Transcript of Opportunities in Life · health insurance companies—ratings agency Fitch has already warned that...
8 APRIL 2020
Nine opportunities for life insurers to emerge from the crisis stronger
Opportunities in Life
1
About this paper
In April 2020 BCG conducted a quick survey amongst its life insurance experts in the major
global markets. Focus of the survey was on the short and medium term opportunities to
improve the business.
We are presenting here in a condensed way nine topics of relevance, loosely grouped into the
categories Growth, Margin and Balance Sheet.
The appendix section is dedicated to the Chinese insurers' and regulator's response, given that
the country was the first to experience severe economic disruption and related opportunities.
The contacts of the contributing experts are provided on page 24 of this document.
2
Insurers should already take steps to ensure their businesses thrive in the medium-term
Execution clarity
Team health
& safety
Business
strength
Financial
resilience
Now Tackle immediate priorities
Near-term Prepare for the rebound
Medium-term Pursue structural enhancements
• Crisis response teams
• Engage / Communicate
• War room scenarios and
adaptive planning
• Reinforce purpose
• Personalized client engagement
• Agent capacity optimisation
• Agent restart
• Digitized sales
• Pricing optimization
• Portfolio optimization
• Client lifetime value mngnt.
• New personalized propositions
• Omni-channel transformation
• AI based pricing
• M&A opportunities
• Business continuity assurance1
• Cybersecurity
• Operational flexibility (e.g.
ring-fence closed books)
• Customer centre optimization
• Remote working capabilities
• Smart operations
• New ways of working
• Advanced claim settlement
• Cash and liquidity
• Balance sheet stress test
• Cost discipline
• Margin improvement: cost
transformation and productivity
• Adapted UW policies
• Anti-Fraud defence
• Hedging and financing strategy
• New risk framework
1. Short term measures: Reduce transmission, re-balance workload, upgrade infrastructure to support report working, etc.Source: Boston Consulting Group
3
Impact of COVID-19 on Life insurers
Balance sheet IncomeOverall
New business to profit in
Protection and guaranteed
savings
Unprotected savings likely to
be most affected in sales in
the short term
Guaranteed savings in force
are affected by
• expanding credit spreads
• further drop in risk-free
rates
• hit in equity valuations
• potentially further
reduction in lapse rates
Capital VolumeLiquidity Pricing ClaimsRetention Expenses CollectionAuM
Source: Boston Consulting Group
Business line
Protection(mortality, disability,
critical illness, ...)
Off-B/S savings (unit linked, defined
contribution, ...)
On-B/S savings (trad. guarantees,
defined benefits, ...)
Key: Positive impact on insurer… Negative impact on insurer… UnclearNo impact for insurer
4
Life insurers can take action now to position themselves properly for the medium term—9 opportunities
Note: B/S = Balance SheetSource: Boston Consulting Group
Now Tackle immediate priorities
Near-term Prepare for the rebound
Medium-term Pursue structural enhancements
Business line
Protection(mortality, disability,
critical illness, ...)
Off-B/S savings (unit linked, defined
contribution, ...)
On-B/S savings (trad. guarantees,
defined benefits, ...)
Innovate in Protection and protected savings1
Move to Underwriting 2.04
Shift to
digital/
hybrid
sales
models
2
Unify
balance
sheet
mgmt
Reset
your
cost
base
6
7
Engage
your
customer
base
5
Provide
estate
advisory
services
3
Use
consoli-
dation
and
trans-
action
window
8
Step up in
alter-
native
assets
9
5
In-force mgmt. Run-off
How BCG can help—our service offering
Pursuit of Profitable
Growth
Reinventing
Distribution
Pivot to
Digital
Evolving Product
and Solution Needs
Leveraging New Data
Sources and Analytics
Efficiency and In-Force
Management
Increasing Regulatory
Complexity
Ways of Working
& Talent
Preparing for Downturn/
Low Interest Rates
Re-invigorate life insurance agency
Legacy Mana-gement 4.0
S II internal model validation
Risk measurement model
Agile
Strategic Work-force Planning
Digitalization and workforce planning
Consumer privacy
Pure digital product Demand centric growth
Insights from Insurance Pools
Distribution strategy/SFE
Digital Customer Journey
Fraud reduction—use case
Insurance excel-lence benchmark
In focus to respond to
COVID opportunities
Future of underwriting
60+/ecosystem play Portfolio analy-sis/TSR analysis
Data analyticsin life insurance
6
Getting beyond emergency mode of recent headlines
Covid-19: Life insurers likely to be hit by adverse
market movements than the rise in claims
Fitch Ratings said it “expects the recent
outbreak of novel coronavirus infections to put
some pressure on Chinese insurers’ profitability
in the near term, but that earnings pressure will
be manageable”
Life Insurers Go Slow on
New Policies to Limit Coronavirus Risk
U.S. life insurers are trying to curb their own
risks to coronavirus by imposing waiting periods
for applicants who have traveled to regions with
widespread outbreaks, industry experts said
Door May Be Closing On
Life Insurance Buyers Amid COVID-19
We could see the collapse of individual life and
health insurance companies—ratings agency
Fitch has already warned that life insurance
companies could be particularly hard hit by the
combination of falling stock markets and
increasing mortality
The Insurance Information Institute, in its first
quarter “Global macro outlook,” reported that
“COVID-19’s impact on global growth and the
insurance industry is likely deeper and wider
than the current consensus and could last well
into the third quarter and beyond”
Insurers across Southeast Asia, including the
Philippines, are seen taking a hit from
potentially higher payouts and slowing
consumer spending amid the COVID-19 outbreak
Insurance credit rating agency AM Best
Major U.S. life insurance providers have struggled as
COVID-19 continues to spread throughout the
country. However, while it's likely that many of
these companies will face policy losses as the
number of COVID-19-related deaths grow, they also
face a threat from collapsing bond rates, which had
hit historic lows earlier in the third week of March
Life insurers braced for hit as bond market buckles
Insurers’ shares have fallen faster than the wider
stock market. In Europe, Allianz, Axa and Legal and
General are down by more than 40%. In the US,
Prudential Financial and MetLife have fallen by more
than half, while Brighthouse has lost almost two-
thirds of its value. Rating agency Fitch has
downgraded its outlook on life insurers in the US, UK
and continental Europe to negative
7
Growth
Nine opportunitiesfor life insurers
Margin
Assets
and capital
Innovate in Protection and protected savings
• Especially in the 60+ segment
Shift to digital/hybrid sales models
• Equip the agents
• D2C and through partners
Provide estate advisory services
• Revisit clients’ pension plans
1
2
3
Move to Underwriting 2.0
• Predictive models, tele-UW, AUS
Engage your customer base
• Now or never: Loans, premium holidays, data and trust,
upselling
Reset your cost base
• It was high before COVID already…
4
5
6
Unify balance sheet management
• Bring together solvency, risk, liquidity and ALM steering
Use consolidation and transaction window
• Grow size and/or capabilities and review portfolio
Step up in alternative assets
• As central banks embark on bond buying frenzy
7
8
9
8
COVID as trigger to address needs of underserved 60+ segment
Seniors are hungry for life...
• Stay fit and young
• Live in home of choice
• Finally realize my dreams
• Enjoy life: Spend, travel, learn
• Continue working
• Fight cancer, dementia, loneliness
• Leave a legacy
...but heavily impacted by Covid
Source: Swiss Re, BBC, NYT, Guardian, BCG
Unprecedented
awareness for
protection
Insurers traditionally
with no relevant
offering for seniors
• Biometric risks beyond 60
incl. impaired lives
• Healthier living/prevention
services
• Longevity risk &
decumulation solutions
• Accident and health cover
• Care & home services
• Access to medical facilities
in emergencies/pandemics
Opportunity to address needs
1
9
Overhaul new product launch approach
Complex processes and products: Sequential approach,
committee decision bodies, legacy IT/processes, regulatory
req’s, limited modularity,...
Accelerate product innovation and pursue mobile-
first through agile, cross-functional teams and
modular product logic (including new risks, e.g., 60+)
Today: From slow product development cycles...
...to agile customer-centric product innovation in the
"new normal"
Source: Society of Actuaries (2017), company publications, BCG
Peers from Greater China provide an example of how
to quickly launch new relevant offers within
days/weeks
Life product development typically takes months to yearsMedian new product development duration in US (in weeks)
39 weeks 45 weeks 48 weeks 52 weeks
Term Insurance Indexed ULWhole life Universal life
Limited customer centricity: Push instead of pull; no/limited
appetite for new protection offerings, e.g., impaired life, 60+
Capture unprecedented health awareness and
provide low-cost/free COVID coverage to create
leads for future up-/cross-selling
Bundle for relevance, providing worry-free product
bundles for SMEs (combining both Life and Non-Life
offerings, e.g., for work resumption)
1
10
Clear potential for many insurance companies to accelerate product innovation
New product Product revision
Note: Phases of product development process not always in exact order performed by all companies. Length of bar means duration of the phase. Left edge of bars means estimated start time of the phase.Source: Society of actuaries (2017), BCG
0 10 20 30 40400 6010 20 30 50
Marketing plans
Traditional rider development
Total time
Idea generation
Reinsurance
Product pricing
Product concept/feasibility
Underwriting guidelines
Assumption development
Product planning & design
Update IT-Day 1
State/regulatory filings
Update business procedures
Average Fastest
weeks weeks
Term insurance
development time
Additional acceleration potential
through agile cross-functional teams
and product simplification/ modularity
1
11
Chinese insurers quickly included extra
COVID-19 coverage in existing policies
and introduced standalone COVID-19
products
New products or integra-tion in legacy products
Source: Taikang Life, BCG
For example, Taikang Life introduced a low-
cost one-year COVID-19 protection product
with a fixed price (irrespective of risk profile,
no health questionnaire) in early February
2020
Eligible from 30
days to 70 years
Coverage for one
year only
Coverage for
accidental
death/disability
Coverage for
disability/death
from COVID-19
Sum assured: RMB
200k (USD 28k)
Premium: RMB 100
(USD 14)
Fast innovation in Greater China during Covid-19
1
12
Asian insurers offering free COVID-19
protection (low sum assured) to capture
customer data and generate leads for
cross-/up-selling
Product innovation as marketing lever
A
B
A B
Source: Tencent, Prudential, BCG
Prudential: Free COVID-19 coverage (HKD
10K for infection, HKD 100K death) for
first 500K registrations in Pulse health
app for Hong Kong residents
Tencent Insurance: Free COVID-19
coverage (RMB 10K for serious infection,
RMB 50K for death), underwritten by
Taikang Life
1
13
COVID-19 provides a radical environment to force insures to accelerate digital transformation
1.7
0.60.3
2.6
2.0 2.2
Zhong An Taikang
Online
SD Bao
+53%
+233% +633%
Digital players still had strong growth
momentum under COVID-19…
• Overall risk awareness
has increased
• More open to online
sales without F2F
…as their digital capability enables
them to capture the opportunity
• Strong digital
capability became
more important for
online sales &
services to capture
opportunity
Source: Lit. research, BCG analysis
Demand
side
Supply
side
Key
implication
• Many insurers started
to transform their
business models and
accelerate digital
transformation
2019 Jan-Feb 2020 Jan-Feb
GWP, CNY B
2
14
Defining moment for non-traditional sales to capitalize on D2C and B2B2C
2014
35
IFA/broker
5
2015
4
20172016
3
2018
Tied agents
Bank
Direct
Other
Help/Support existing
B2B2C partners
Set-up/Enlarge digital sales
connections with bancs (e.g.,
Anivo in Switzerland now heavily
growing bancassurance)
Build/Enter new
ecosystems
Develop new partnerships. e.g.,
with online shopping (Flipkart)
prevention and health platforms
Grow D2C capabilities
E.g., redirect marketing spend to
digital channels to generate direct
leads
2
Situation: Life insurance customers in the past very
loyal to their sales channel—until now …
Opportunity: D2C channels and B2B2C ecosystem plays
accelerated by the current lockdowns
D2C sales with minor role in the past
German sales channel mix in life insurance in %
7
2015
5
Direct 1
6
2014
6
2017
6
2016 2018
Tied agents
IFA/broker
Other
USA sales channel mix in life insurance in %
1. Includes tele-sales and direct mail; Source: LIMRA, BCG
15
Become a marketing led organization
Radically rethink your
marketing and sales tactics
2
29%
D2C partnership -
adding term, family
income, and serious
illness products
Up to $3.4Bn price raised eyebrows (Nov 19)2
Gig-model for agents – telesales is their core
• Lead generation analytics engine
• Targets middle market customers
Life insurance companies traditionally
have focused on how their products
and marketing resonate with
distribution
End customers have not been the
priority…
…so insurers loose sight of their
end clients needs
Carriers beginning to shift focus
Incumbents double
down on
partnerships
…and thinking about
the intersection of
technology and
distribution
InsurTechs capitalize
on demand from
COVID fear1
1. Increase in digital applications or sales due to COVID; 2. $2.3Bn base price with potential to rise another $1.1Bn in potential earnoutSource: Life Annuity Specialist, BCG
B2B2C - offering life
insurance sales through
one of India's largest e-
retailer
250% 10x
42%
16
Advisors can provide peace of mind and more advisory to stressed clientele
1. Legg Mason; 2. Alight; 3. Cerulli, 4. JD Power Survey of US consumers asking about change in perception of life insurance due to COVID-19; 5. US Only, LIMRA advisor pulse survey (Mar 2020); Source: Legg Mason, Alight, LIMRA, BCG
Clients under immense stress—beyond health, their worries
extend from cash flows to asset allocations
Provide confidence and advisory—guidance on broader financial
situation and best practices (subject to regulatory conditions)
• life insurance impression more positive for 22% of customers4
1 in 3 Have made emotional
decisions in their 401K they
later regretted1
16x on Feb 28Increase in net trading activity
within 401K accounts2
Don’t have an official source
for information on their 401K
plan340–50%
Situation: Market volatility causes immense financial
stress to clients
Opportunity: Customer touchpoints increasing, use
these to provide advisory services and peace of mind
3
Jackson National's partnership gives
agents and advisors access to a tax
optimization tool that is
product/investment strategy agnostic
Agents in Japan with systematic reach
out to customers via phone to confirm
support in any insurance related
questions and quick benefits claiming
28%
16%
20%
55%29%
52%
Way you communicate
Communication Frequency
Yes-a great extent NoneYes-somewhat
Agents see COVID impacting customer touchpoints
17
Life insurers can expand usage of simplified underwriting to meet demand
1. Increase in app usage and appointment volumes reported in response to COVID (Mar 20,2020); 2. Hannover ReSource: Life Annuity Specialist; Quartz, Forbes
Insurers can ease thresholds on simplified UW
• Raise policy limit threshold (e.g., 1mn to 2.5m)
• Sell small policy today, that increases with full UW
Consumers are comfortable engaging on their medical information via tele-health apps – activity up1
[Will] stop requesting medical evidence as part of our
underwriting process … any new applications where a GP
report (GPR) is required will now be postponed as we will be
unable to offer cover until the strain on the health service is
resolved. Aviva
4
Situation: Medical facilities capacity strained for
traditional or paramedical UW due to COVID-19
Opportunity: Fully utilize automated underwriting and
teleunderwriting
50% 70% 158%
Tele-underwriting can help better identify risk factors
Nicotine
Cancer
TeleUnderwriting
Paramedical
"Yes" responses to impairment2
18
Now or never: Engage with your customers ("in-force management")
Source: Case work; BCG analysis
5
"We have valid customer email and
cell phone number for only… "
"Customer enquiries
in March up .." 2x
1 in 6
So far: Little direct company to customer interaction
Direct reach-out for
Premium holidays
Policy loans
Buy-outs
Top-up covers, fitbits, etc.
Concerns, complaints, recommendations
...
Now is the time to engage with your customer base
19
Reset your cost base
ChampionLaggard
-1 ppt
Mid-Tier
-3 ppt-5 ppt
20172010 20142011 2015
15.2
2012 2016
13.7
2013
14.7
2018
13.1 13.414.4
13.5 14.014.9
Source: BCG Insurance Pools; BCG DAI in Insurance study 2019
Use the “new normal” to fully digitize your business model
Digital leaders were able to lower their cost ratio in 2015-2018 much better than digital laggards
Expenses in % of premiums of life insurers in world top-22
markets
Acquisition Ratio Admin Ratio
6
Cost ratios of life insurers globally continuously rising Now is opportunity for radical cost reduction
20
Unify balance sheet management
In a crisis some organizations discover that their near-perfect
fragmentation of functions, know-how, reporting systems and
responsibilities can compromise or paralyze decision making
Source: BCG Insurance Pools; BCG DAI in Insurance study 2019
We are trying to understand our
liquidity situation
ALM
Investment
management
Actuaries
Risk
management
Treasury
Finance
Regulatory
solvency
ALM
committee
Investment
committee
Risk
committee
Bring together solvency and liquidity steering with the
asset-liability management function
Extract key information into models that allow you to
run “what-if” scenarios
Prepare action plan for main adverse scenarios, define
triggers, communicate assumptions
7
Internal
model
Head of
Hedging
21
Use down-turn to consolidate positions and dispose of volatile back books
• COVID already leading to depressed valuations for insurers
in Europe and US—e.g., JP Morgan adjusted EPS/DPS
by-8%/-4% for 2020e–2022e
Prepare for M&A to pick up under-capitalized players or to
enhance your capabilities: acquire digital assets, InsurTechs
Take advantage of suppressed valuations:
Weak-Economy Deals Outperform Strong-Economy Deals
COVID impact on life insurers’ valuations Opportunity
Source: 2019 Global M&A Strategic Study Conning; JP Morgan; Debevoise and Plimpton; Refinitiv; Datastream; BCG analysis
99.7
101.6
99.0
100.0
104.6
102.8
90
95
100
105
T+3T-3 Year 1 Year 2
Strong-economy deals
Weak-economy deals
3.8
Cumulative relative total shareholder return index of deals in FI and
insurance
120
4/1/2019 10/1/20197/1/2019
100
1/1/2019 1/1/2020 4/1/202060
80
140
EmergingAPACLife
MatureAPACLife
Global Life
NAMR Life
TSR Index life insurers
(2019=100)
MatureEuroLife100
Jan 23
Hubei lockdown
8
22
01/2004/20190
07/19 04/202010/19
2
1
3
Step up in private assets to capture illiquidity premium/reduce asset volatility
Private assets provide opportunity for life insurers
• Illiquidity premiums for similar asset ratings (e.g.
commercial real estate loans, equity release mortgages,
infra debt)
• Although surging demand also led to yield compression
• Lower volatility of asset portfolio
New capabilities required to succeed
• New capabilities related to structuring, execution for
direct origination
• New partnerships and manager oversight for 3rd party
origination
• General step-up in performance/risk measurement and
reporting capabilities, as well as ESG
Low for even longer … … requiring new capabilities in investments
1. PML: Property, Mortgages & Loans 2. Funds = Collective Investment Undertakings 3. Possibility to shift assets to illiquid/alternative assets subject to local regulationsSource: EIOPA, Thomson One - Eikon, BCG
Investor risk aversion and
government intervention
leading to ever lower
government bond yields …
10y US Treasury yields
(percentage)
… further compressing
investment returns for life
insurers with strong (public)
debt exposure
Asset allocation of EU life
insurers (Q3 2019, percentage)
Other 4
Gov bond 20
Corp bond 19
Funds2 39
PML1 7
Overall SAA
Equity 11
Multi-asset 15
Alternatives 9Other 7
Equity 32
Funds deep-dive
Debt 37
Deep-dive
9
Subject to regulatory context3
23
"Next 18 months will reshuffle the field
more than the last ten years in total -
some will come out winners, others will
stay stuck in the past"
24
Authors and contributors to this paper and their contacts
Managing Director &
Partner, Zurich
Managing Director &
Partner, India
Partner, UK
Managing Director &
Partner, Japan
Pranay
Mehrotra Shaun Yow
Takashi
Horikawa Tim CalvertWalter Reinl
Consultant, Hong Kong
Managing Director &
Partner, Singapore
Managing Director &
Partner, US
Managing Director &
Partner, Italy
Managing Director &
Partner, Iberia
Christoph Krieg Wei Chuan Lim Rob Sims Matteo Coppola Santiago Mazon Managing Director &
Partner, France
Wallaert.Charles-
Charles-Antoine
Wallaert
Knowledge Expert,
Germany
Managing Director &
Partner, France
Managing Director &
Partner, Netherlands
Managing Director &
Partner, China
Tatjana Bender Benoit Mace
Tijsbert
Creemers
Michelle Hu
SKA, Boston
Partner, US
Partner, US
Nick GagnonManaging Director &
Partner Poland
om
Norbert
Dworzynski Joe Khoury
Nathalia
BelliziaManaging Director &
Partner, US
GB Taglioni
Authors Contributors
Managing Director &
Partner, US
Managing Director &
Partner, Brussels
Consultant, Germany
Karolien
Gielen
Jonas HirzManaging Director & Partner,
Germany
Christopher
Freese
25
Appendix—China's response
26
COVID-19 resulted in limited direct damage to life/health insurance companies
NHSA: Notice about ensuring COVID-19 patients could get
sufficient medication and treatment
…
2. Ensure patients՚ medication and treatment will not be
influenced by affordability
• All treatment costs beyond the current reimbursement
from public health securities funds will be covered by
government budgets
• All medication and treatment items listed in the COVID-19
Treatment Guidelines will be included in reimbursable list
for a short time
…
NHSA1 released COVID-19 reimbursement policy,
reducing the compensation of commercial insurers
1. National Health Security Administration of ChinaSource: Lit-research; BCG analysis
Limited additional compensation paid by insurers
due to COVID-19
Compensation type Impact
Medical payment
Critical disease
compensation
Death compensation
• Limited amount of medical
payment as paid only after the
reimbursement of public health
securities funds
• Currently, COVID-19 is not
included in disease list of
almost all critical disease
insurance products in China
• Limited death compensation
as a result of low death rate
of COVID-19 patients
27
Strict quarantine requirement in China resulted inshort-term decrease in new product sales …
Sales channel mix of life/health
insurance products in China
Strict quarantine requirements lead to
sales decrease in core sales channels
Others
(e.g., online)
Total
Individual agents
Banks
100%
~ 60%
~ 30%
~ 10%
Individual agents and banks are the most important
channels of life/health insurance products in China
Individual agents
• Face-to-face communication
is the main method of
individual Agents to
sell products
• Their interaction with clients
were limited by extended CNY
holidays, self quarantine, and
other safety reasons
Banks
• Due to COVID-19, all banks
are required to close/limited
operation for essential needs
Source: Lit-research; BCG analysis
In the long run, demand
of life/heath insurance
in China will increase
• Critical public health
events will stimulate
residents' concern
regarding
uncertainty, which
creates more demand
of insurance
28
... but Chinese companies responded rapidly to better weather the challenge
Service innovation Product innovationSocial responsibility
Insurers proactively promote their
online sales channel, enhance their
online capability for customer
service, and enable online
underwriting to improve online
service efficiency
To address corporate clients՚ concern
regarding returning to work normally,
insurers conducted series of product
innovations to help client to mitigate
the risk of their staffing infected
by COVID-19
70+ Chinese life/health insurance
companies included COVID-19 into
their coverage disease list to show
their social responsibility and reduce
the public panics with limited extra
compensation estimated
Source: Lit-research; BCG analysis
29
BCG FY forecast
China insurers have continued to expand throughout corona crisis (Jan-Feb 2020)
151 222158 223
Feb DecJan
1,302 ~1,4004.4% 0.5%
4~5%
Source: Lit. research, BCG analysis
699943750
954
DecJan Feb
2,963 ~3,100
7.3% 1.2%
4~5%
……
2019 & 2020 Monthly cumulative GWP in China, CNY B
Non-life insurers Life insurers
BCG FY forecast
2019 2020
30
Traditionally, insurance apps fail to
engage customers—some insurers use
the current situation to provide more
relevant content and increase traffic
Digital customer engage-ment through innovation
For example, AIA launched a COVID-19 alert
service on their mobile app (AIA Connect)
using GPS data to alert users of nearby
confirmed infections
Source: AIA, BCG
31
Insurers in China move beyond individual
life—for example, offering work
resumption products covering both life
and non-life coverage
New SME work resumption bundles introduced in CN
Source: Company websites, press releases, BCG
Chang An Insurance and Jixiang Life offer a
joint “Resumption of Work” insurance to
facilitate business resumption after an almost
two-month standstill
Resumption of Work insurance
Comprehensive “worry-free” offering for SMEs to mitigate the
financial and health risks of COVID-19 (e.g., second infection wave)
when restarting business
Comparable products from other carriers, e.g.,
Coverage: Liabilities such as
production loss, employee wage
protection, and quarantine
expenses
Coverage: COVID-19 diagnosis
(health/critical illness),
employee accidents and
personal injuries
32
Chinese gov't released policies to guide the life/health insurance market under the COVID-19 situation
1. China Banking and Insurance Regulatory CommissionSource: Lit-research; BCG analysis
Jan 27, 2020 • China Insurance Association proposed that all insurers in
China provide full supports to the national initiatives of
COVID-19
Feb 3, 2020 • CBIRC1 released a notice to ask insurance companies should
cover COVID-19 in their existing products, and provide more
convenient service to COVID-19 patients in claim, with
controllable risk exposure
Feb 11, 2020 • CBIRC released Notice of Promoting Virtual Customer Visits in
Insurance Industry
• The notice clearly defined the precondition of virtual
customer visit, and asked insurance companies to
standardize their virtual customer visit process, enhance the
customer identification, and protect the rights and interest
of customers
New policies published after the COVID-19 outbreak in China
As a next step, Insurance
Administration in China will
further regulate the
behaviors of online sales and
virtual service, which may
change the sales channel mix
of insurance in the future
bcg.com
