We have a few extra Predictions 2021 for you;
Matthew Newton and Brittany Damora, crisis response experts for London’s reputation and privacy firm Schillings, have provided the following insurance predictions the sector could face this year:
· Romance cases/extortion frauds: In an age where internet dating is an increasingly commonplace way to seek out human connection, the isolation of lockdown has seen so-called romance crimes rising faster than you can say ‘swipe-right’.
· Virtual Kidnapping: With limited travel, increased working from home and reduced income, virtual kidnapping is currently on the up and up. Virtual kidnappings are a lucrative and low-risk endeavour for criminals, particularly in comparison to traditional kidnap for ransom.
· Piracy: Maritime piracy can be a highly lucrative job. It is spurred on by land-based issues – primarily corruption, weak rule of law, unstable governments and economic conditions. These factors are exacerbated by the COVID 19 pandemic as security is directed to other priorities and the global economy suffers a downturn.
· Employee Safety: The way employees work has shifted rapidly. With companies such as Agoda and AirBnb now offering ample ‘work at home from abroad’ opportunities, an employee that typically works from the London office is now spending a month in the Southern Philippines. This poses entirely new challenges for a company from a security perspective, from physical safety to cyber security.
· Deep Fakes: Advanced technology will bring not only huge benefits, but huge risks to people and companies. Attacks may be discussed in the form of simulated voices on the phone to extort money, to hacktivists using deep fake tech to make false claims and statements about companies. Companies must ensure they have the right policies in place to prevent such attacks.
Meanwhile Max Carter, CEO of New Dawn Risk, has made the following prediction;
This year UK consumer trust in the insurance industry will hit rock bottom
This year, the combination of a perception that insurers are looking to ‘wriggle out’ of paying Covid-related business interruption claims and general insurance premiums rising as a result of hard-market reinsurance rating pressure will further dent consumer confidence in the value of insurance.
Back in 2017, a survey by comparison site Claims Rated found that only 37% of younger consumers (aged 16-29) believed that an insurance company would pay out in the event of a claim. The PPI scandal still lingers in the memory of many, and rising general insurance premiums over the past couple of years have continued to compound the issue. In specific sectors, such as the construction industry, struggling with massive liability insurance premium increases and additional exclusions in the wake of Grenfell Tower, confidence in the value of insurance has fallen even lower.
At New Dawn Risk, we predict that commercial SME buyers will be more inclined to allow non-mandated insurance to lapse as they struggle with increased financial pressures from the impact of covid, justifying their decisions on the basis that insurers try to avoid claims in any case. Purchases of newer products, such as cyber insurance, will almost certainly fall off as well. It will take an industry-wide coordinated campaign to rebuild consumer trust in the industry.