A recent survey of TechAssure’s insurance agent and broker members underscores how the COVID-19 pandemic has shaped their technology and life sciences clients’ approach to key business challenges and risks.
“Technology and life sciences companies are pioneers in innovations, and have helped the world adapt since the onset of the pandemic,” said Veronica Somarriba, EVP, Technology Segment, North American Commercial Insurance, Chubb. “In doing so, many of these companies have seamlessly changed the way they operate, potentially creating unintentional new risks and exposures in the process. As these companies continue to evolve, it’s critical that they have a good understanding of any new exposures and ways to properly manage them.”
“Our members are dedicated to helping technology and life sciences clients balance property and casualty insurance risk with business reward,” says Christine Kallivokas, Executive Director of TechAssure. “Their deep expertise in these industries enables them to effectively build robust risk mitigation programs to ensure that sufficient insurance coverages and limits are in place so clients can focus on being innovative and productive.”
When COVID-19 emerged, technology and life sciences companies had to navigate unprecedented change and disruption, shifting daily operations to meet new needs. According to the survey, 39% of insurance agents and brokers say their clients have increased supply chain diversity as a result of COVID-19, with 48% reporting that their clients plan to increase the diversity of their supply chains, but haven’t yet.
Supply chain disruption is only one of the business concerns on technology and life sciences companies’ radars. The insurance agents and brokers surveyed report that their clients are “very” or “somewhat” concerned about a variety of business challenges, including but not limited to:
- Supply chain shortages: 93%
- Emerging regulations impacting their industry and associated compliance requirements: 86% (up from 83% in 2019)
- Privacy and data protection: 86% (up from 83% in 2019)
- An increasingly litigious environment: 81% (up from 67% in 2019)
The survey data reveals that for some technology and life sciences companies, COVID-19 served as a catalyst for positive developments as well, leading to new products and services and business growth. More than half of respondents (58%) say COVID-19 led their clients to innovate new products/services they didn’t previously offer. Furthermore, nearly a third (31%) of respondents say the pandemic created new opportunities for their clients to do business in domestic (U.S.) markets, and over a quarter (28%) say the same for international markets. Beyond geographic expansion, some technology and life sciences companies are considering business growth via merger and acquisition (M&A) activity: 40% of respondents say that their clients are considering an acquisition over the next year (up from 30% in 2019).
The survey highlights that as their operations and exposures change, it’s essential for technology and life sciences companies to work with their insurance agent or broker to update their risk management and insurance coverages and limits as needed. According to the data, 45% of respondents say their clients already have adjusted insurance policies and coverages to respond to business challenges (up from 25% in 2019), while 48% say they are in conversation with their clients about how to adjust insurance policies and coverages (down from 51% in 2019).
To learn more – including forthcoming snapshots of data around how COVID-19, business challenges, and M&A activity impact risk for technology and life sciences companies – visit https://www.chubb.com/us-en/business-insurance/technology.html.
About TechAssure
Established in 2000, TechAssure is an international not-for-profit association dedicated to advancing corporate insurance and risk management practices for companies with technology-related risks. The association is comprised of independent regional insurance brokers located across the United States, Canada, Europe, South America, Australia and India. For additional information on TechAssure, please visit www.techassure.org.
About Chubb
Chubb is the world’s largest publicly traded property and casualty insurance company. With operations in 54 countries and territories, Chubb provides commercial and personal property and casualty insurance, personal accident and supplemental health insurance, reinsurance and life insurance to a diverse group of clients. As an underwriting company, we assess, assume and manage risk with insight and discipline. We service and pay our claims fairly and promptly. The company is also defined by its extensive product and service offerings, broad distribution capabilities, exceptional financial strength and local operations globally. Parent company Chubb Limited is listed on the New York Stock Exchange (NYSE: CB) and is a component of the S&P 500 index. Chubb maintains executive offices in Zurich, New York, London, Paris and other locations, and employs approximately 31,000 people worldwide. Additional information can be found at: chubb.com.