The outlook for the group risk and healthcare industries is buoyant for 2021, despite the ongoing challenges presented by the Covid pandemic.
Delegates at Corporate Adviser’s Workplace Protection and Wellbeing Conference retained an optimistic outlook, saying the health crisis had led to a renewed focus on employee health and wellbeing in the workplace.
Dr Wolfgang Seidl who leads Mercer’s Workplace Health Consulting in the UK described 2020 as a “watershed moment” for the industry.
He said that there was more of a focus on employee health and their mental health. “Clients have woken up to the importance of having an overall health strategy.” He adds that as we move into what is likely to be the deepest recession in living memory, the cost of providing an effective health strategy will clearly be of prime importance for many clients.
This should be a good thing for the industry though he argued. “There will be more of a focus on what works economically as well as in health terms. The return on investment will be important and this will lead to more strategic data-driven approaches rather than a haphazard approach that just pays lip service when it comes to delivering health and wellbeing benefits.”
Premier’s head of risk and healthcare Allyson Gayle told delegates that the industry was on “a positive trajectory”. Intermediaries had an important role to play, she said, in supporting employers and could be an effective extension to a company’s HR, payroll and finance teams when it comes to providing employee benefits.
Looking ahead to 2021 both Seidl and Gayle said they expected insurers to provide more and better support for a range of chronic conditions. Seidl says while this may seem counter-intuitive, if purse strings are tight, there may be value for both employers and insurers in providing “smart care” for certain chronic conditions, leveraging technology and using dedicated nurses and managed care pathways.
Gayle says that looking into 2021 she would expect there to be growth across different areas of the workplace protection market but in particular healthcare, rehab and smart care options.
This optimistic outlook was shared by Katharine Moxham spokeswoman for Group Risk Development. She told delegates that employers now valued group risk in a way they did not in the past. “They see the value of these products, they are less of a commodity,” she says. “It is important for the industry to build on this.”
However, Moxham did not underestimate the challenge facing the industry. “We have been relatively sheltered within the world of financial services, but it is not like that for many other industries.” But she said that employers who remained viable would be looking to keep employed benefit and ensure embedded services are used much more effectively.
AMII chairman Stuart Scallion was also positive for the outlook for the private medial insurance industry, despite the fact that the industry had been particularly affected by the pandemic in 2020, handing resources over to the NHS so being unable to provide many core benefits.
While some insurers were now providing rebates to consumers, these haven’t been uniform across the board. However Scallion pointed out that with claims predicted to bounce back in 2021 it was important for insurers to ensure they are running “financially sustainable and resilient businesses”.
Scallion says there was likely to be demand for private healthcare services going forward particularly with waiting lists in the NHS growing. He says: “We expect this demand to increase in both the consumer and corporate sector, as both the general public and employers look at other means to deliver healthcare.”
He says that anecdotal evidence from clients indicated that new business interest had been “buoyant” – although he pointed out this was distinct from new business policies being written to date.
Scallion added that Covid crisis has already created an opportunity for innovation within the healthcare market. He estimated that the growth in digital technology and applications in healthcare had “leapt forward five years in a matter of months”.
He says that previously there had been a reluctance to embrace digital healthcare solutions but these looked likely to stay for now.
Moxham said this digital innovation provided an opportunity, rather than a threat to intermediaries and she did not expect benefit platforms to cut intermediaries out of the relationship with employers. “Employers will be looking for intermediary assistance to select the most appropriate platform,” she says.
Scallion shared Moxham’s views though that despite this innovation there remained economic challenges ahead. He adds: “There are also some unknowns around Brexit and this could also impact and influence confidence along with the ongoing Covid situation.”
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