The unforeseen global pandemic in 2020 impacted businesses and people across the world, greatly affecting the insurance industry. Some businesses experienced major losses and drastic changes to the workplace, while others were classified as "essential" businesses that were critical to the public's functioning of everyday life.
The unforeseen global pandemic in 2020 impacted businesses and people across the world, greatly affecting the insurance industry. Some businesses experienced major losses and drastic changes to the workplace, while others were classified as "essential" businesses that were critical to the public's functioning of everyday life.When considering the impact on individuals, many realized just how detrimental a COVID-related health crisis could be to their finances if treatment and care were not covered by insurance. The unemployment rate peaked in April at 14.7%, causing panic and frustration with lost health care coverage, along with rising life insurance policies. The widespread public health and safety concern even caused a push to allow every person, insured or not, to be tested for the virus.
No matter how you look at last year's events, the pandemic impacted every person and will continue to impact them and their insurance needs in 2021 and beyond. To help keep you abreast of the changing landscape, below are the top insurance trends to keep on your radar to avoid any surprises in the new year.
Personal insurance trends to watch in 2021
Auto insurance
While 2020 is behind us, the coronavirus is still present, forcing businesses to operate at restricted capacity and continuing with remote work. That means people are working from home and commuting far less — eliminating about 41 minutes of commuting time a day. So what does that mean for auto insurance in 2021?
According to the Insurance Information Institute, personal auto insurers have returned nearly $14 billion to customers due to decreased driving because of the pandemic. Keller-Brown always encourages our customers to notify us about significant life changes, such as remote working or losing a job. These changes may result in reduced mileage and reduce rates.
Homeowners insurance
You have probably spent more time in your home in 2020 than ever before. If you tackled any home renovations that have increased your home value by over $5,000, you should speak to your insurance agent to ensure you have the proper coverage. This includes basement renovations, outdoor entertainment areas and additions. Learn more about how home improvements can affect your coverage and what you can do about it in this post.
Health insurance
Health care has obviously been a hot topic throughout 2020 and that trend isn't going anywhere in 2021. Health care will continue to be high priority for individuals of all ages, with many people leveraging telehealth and virtual care more than ever before. Insurers will focus on this trend, investing in more virtual services to better serve customers.
There are certain factors that will contribute to rising healthcare premiums in 2021. Mental health coverage has become a priority over the last few years, with a huge surge due to the pandemic. Additionally, people with conditions like diabetes, hypertension and cardiovascular disease are more vulnerable to COVID-19, which has caused an increased focus on offering solutions to manage their conditions.
Life insurance
The COVID-19 pandemic has unfortunately generated more awareness about the critical need for life insurance. More people, especially millennials, purchased life insurance policies in 2020 in order to protect their family in case they were to fall ill and pass away. Life insurance is coverage especially beneficial to those who have dependents or who want to provide financial support to loved ones should they no longer be able to financially provide for them. However, even though more people have taken out policies, life insurance premiums have not increased.
Learn more about our individual life insurance policies here.
Commercial insurance trends to watch
Cyber insurance
With the transition to a remote workforce, cyber threats have drastically increased and are expected to continue into 2021. Employees have been forced to work from home networks, or maybe even personal devices, that may or may not have properly deployed cybersecurity protection. Even more concerning, businesses that did not support remote employees before the pandemic hit were forced to make the switch quickly, potentially overlooking proper compliance and cybersecurity controls intended to protect data and devices outside of a secured, corporate network, therefore making them easier targets for cyber criminals.
With work-from-home policies are likely here to stay and an increase in use of the Internet of Things (IoT) devices with 5G, businesses will be more prone to cyberattacks and threats and should consider investing in cyber insurance in 2021. Keller-Brown offers Cyber Liability Insurance that covers a range of digital challenges such as damages due to loss or theft of client data, introducing a virus into another business' network, and email transmitted libel.
Workers' compensation insurance
In Pennsylvania, workers' compensation protects your employees and your business. If your employee is hurt on the job, work comp insurance will pay for medical care, disability and death benefits. Workers' compensation is the only major commercial insurance line that has not experienced significant premium rate increases over the last five years. Due to the significant decline in the time spent at the workplace, workers' compensation claims have been down significantly. However, there is uncertainty around the long-term health effects for severe coronavirus cases, which would ultimately increase workers' compensation costs in years to come.
Reach out to our team to learn more about workers' compensation insurance and how it can protect your business in 2021.
Umbrella insurance
Commercial umbrella insurance provides businesses with extra liability coverage. Experts are estimating rate increases for casualty insurance buyers due to social inflation, which leads to higher claim payouts. In today's climate, there is still so much uncertainty and unrest, which contributes to increasing rates. Companies with large corporate risks are seeing the largest increase in umbrella and extra liability coverage due to situations like increasing litigation costs and broader definitions of liability.
Conclusion
Whether you are an individual or business seeking insurance coverage, it's always best to speak with an agent to discuss your options. Being proactive with your insurance needs is the key to being protected in many unexpected events.