Many of the top concerns held by policyholders in 2020 will carry over into the new year.
COVID-19 will continue to dominate the conversation in 2021, but other risks like extreme weather and cyber will also be top of mind for many insureds.
2020 was a tumultuous year that many were happy to see come to an end. Many of the year’s greatest challenges, however, did not cease with the start of a new year.
Much of what made 2020 so devastating — the global pandemic, record-breaking weather activity, and economic turmoil — impacted insureds directly, and may have direct implications on policy shopping trends in 2021.
Taking a pulse on this, a recent Private Risk Management Association (PRMA) survey identified the greatest concerns of insurance consumers going into 2021. At the top of the list, COVID-19, travel and family safety continue to be top-of-mind for insurance customers in 2021, followed by catastrophic weather and the ability to retain insurance coverage.
According to the PRMA survey, more than 150 agents and brokers representing 37,000 clients found many feeling vulnerable about the future, underscoring the importance of homeowners taking proactive measures now to prepare against potential losses.
Among the study’s key findings, 76% of risk managers surveyed said that family safety and financial concerns stemming from the pandemic are impacting their clients. Nearly 54% say catastrophic weather worries keep their clients up at night, and precisely half (50%) say travel and personal safety weighs on the minds of their clients. Ranking just above cybersecurity concerns, 30% of risk managers say that the ability to secure and keep insurance coverage is also an issue.
COVID-19′s far-reaching impact
COVID-19 changed life as we once knew it in 2020. The pandemic sent workers home and kept offices empty throughout the year and into 2021. While virtually the entire world was stuck at home, many Americans took up unplanned renovation projects. The PRMA survey posed the question, “Will clients be more actively renovating and updating their indoor and outdoor space in 2021?”
A majority of risk managers (79%) said yes.
Before insureds start construction or hire any service providers, it’s important to vet contractors and ask the right questions. Insureds should also ensure they have the proper insurance coverage in the event damage is done to the structure of the home.
2020′s record-breaking extreme weather activity will only worsen
2020 was a historic year for more reasons than just coronavirus. The year’s Atlantic hurricane season broke the record for most named storms, topping out at 30. U.S. wildfire activity also reached an all-time high, with more than 57,000 fires burning over 10 million acres, according to the National Interagency Fire Center (NIFC).
As climate experts and industry professionals have said for years, the worsening impact of climate change will only continue to grow as time goes on, worsening challenges for the insurance industry and impacting its customers whose coverage needs will likely shift as a result. As these challenges evolve, new solutions will be needed to counter them.