The (re)insurance sector is well-versed at navigating market-changing events, and while the impact of previous shock events such as Hurricane Andrew, the terrorist attacks of September 11, 2001, and Hurricane Katrina may have resulted in a loss of capital and reduced capacity in the short-term, the market responded to each occasion by innovating, working with governments and attracting more capital in the longer term. Liquidity and access to capital are crucial to ensuring risk carriers can continue to provide cover following market-changing events.
As the pandemic continues, a massive restructuring of the economy is already underway. Companies in many sectors are starting from a zero basis of activity, which is daunting, but this gives them license to reinvent their organizations in ways not previously available to them except in their imaginations. It’s an opportunity, but perhaps also a necessity for survival: companies must rethink every aspect of the previous business-as-usual, from finance to operations to products to people.