Other parts of this series:
In my previous two blog posts in this series, I talked about our data-driven research into how insurers responded to the COVID-19 pandemic. I already wrote about communities and customers, so now I will turn to agents/partners and employees.
Insurers launched new tools and support for agents and partners
While most insurers offered financial relief for customers, a more limited number of insurers launched financial assistance specifically for agents and partners.
The immediate need was to help agents and brokers manage liquidity. Progressive committed $46 million to its agents back in May 2020, including $43 million in interest-free advanced performance bonus payouts. Similarly, Travelers accelerated $100 million in commission payments to eligible distribution agents and brokers.
Not all insurers focused on liquidity, however. CNA, for example, partnered with Reahard & Associates to offer live, online training focused on presenting finance and insurance products effectively in a socially distanced world.
Once the immediate stress of the pandemic subsided, insurers were able to focus on building a more resilient agent network. Nationwide is of particular note here. They launched 3 major initiatives for their agents:
- Auto Quote On The Go to allow agents to complete an auto quote in 60 seconds
- A Commercial Insight Center to offer middle market agents timely, relevant information for specific industries and middle-market trends
- A Partnership Platform, a first-of-its-kind offering that enables partners and developers to digitally deliver Nationwide’s insurance products all on the same platform, making the partner experience quick, easy and seamless.
Of course, Nationwide isn’t the only insurer to support their agents and partners. John Hancock launched a proprietary electronic application platform, JH eApp, to streamline insurance applications. Jackson introduced a new distribution digital experience focused on independent Registered Investment Advisors (RIAs). MassMutual did a similar initiative to Jackson but went about it in a different way. Instead of building its own platform, MassMutual acquired a fintech platform for RIAs called Flourish.
Takeaway: Many changes caused by the pandemic will not revert post-pandemic. Customers will still expect to have access to seamless digital channels, immediate quotes, and 24/7 support—and agents are key to this type of customer experience. In many ways, the changes insurers make for agents and partners will naturally cascade down to help customers. Partnerships and acquisitions are also increasingly important for fast pivots and to drive quick innovation. Insurance companies that invested in their agent and partner networks during the pandemic will be in a strong position post-pandemic to grow at a faster pace than those who didn’t invest as much last year.
Insurers supported employees and improved operational efficiency
Across all groups, the goal of COVID-19 related short-term initiatives was largely the same: continued operations and immediate financial and health support. Employees were no different.
One of the first things insurers needed to do was support working from home. Allstate shifted 90% of its workforce to remote, and USAA had 94 percent remote. Naturally, travel was restricted for many insurance companies, like Aflac.
Along with an immediate shift towards remote working (I will get into the long-term implications of this momentarily), insurers announced new physical and mental health benefits. New York Life extended its bereavement policy up to 15 days of paid time off and the ability for employees to define who a “loved one” is. MassMutual offered 80 hours of extra time to employees for COVID-19 related needs. And MetLife allowed its licensed healthcare workers voluntary paid leave to fight against the pandemic.
In addition to time off, most insurers launched wellness programs to support their workers during the stressful time:
- Allstate offered services like telemedicine, prescription home delivery and emotional and financial support lines for employees.
- TIAA offered free at-home COVID tests for its 14,000 employees.
- Prudential created a financial wellness program with online tools and virtual programs to help employees manage finances against disruptions, like the pandemic.
- John Hancock was particularly unique, having created a virtual summer program for employees’ children.
Some insurers went beyond wellness programs and offered more direct financial assistance:
- USAA partnered with Sodexo to offer curbside meals and grocery pick-up for its employees.
- Prudential covered co-pay and co-insurance costs for employees and dependents who needed a COVID-19 test.
- Lincoln Financial Group extended the continuation of coverage for employees whose work status was impacted by COVID-19, such as reduced hours, leave of absence or temporarily laid off.
- New York Life increased its contribution to the Employee Assistance Fund to $1 million.
- Progressive provided direct financial relief by advancing its annual bonus program
We found four major types of long-term initiatives that impacted insurers’ workforce and operations.
Some cost reduction measures related to physical spaces. AIG relocated its global headquarters to consolidate expensive NYC real estate and reduce office space.
Not all announcements were positive, unfortunately. Allstate cut almost 4,000 jobs, and Nationwide let go 250 workers and furloughed even more. Chubb, however, was the only insurer to publicly commit to no layoffs.
In the middle were companies that offered voluntary programs to reduce their workforce. Aflac offered a voluntary separation plan to eligible employees, and Liberty Mutual revealed an early retirement option.
For the workers that remained, reskilling or upskilling were crucial priorities, as technologies such as cloud were rapidly deployed. Nationwide announced a five-year $160 million Future of Work investment that included an increase in bonus incentive targets. MetLife partnered with Barnum Financial Group to expand the delivery and use of its award-winning PlanSmart financial education programs to other workforces.
Shift in working culture
Of course, we can’t talk about the long-term employee impact of COVID-19 without talking about a hybrid working model where insurers provide flexibility to their workforce—either overall or for specific roles—by allowing them to work from home.
Many of these policies were introduced in the short term to protect against COVID-19. Time will tell how long these hybrid working models will stick around, but there is compelling evidence that flexible working arrangements could become permanent. Nationwide announced a permanent shift to a hybrid operating model that narrows working-on-campus to four main locations and working-from-home elsewhere. While our research did not find any other insurance companies announcing a permanent work-from-home policy, major companies in other industries are talking about it, implying it’s likely on the decision-making table for most insurance companies as they consider when and how they will return to the office.
Takeaway: Employees are the beating heart of an organization. Employees also had some of the more negative side-effects of the pandemic: Many were hard hit by layoffs and increased pressure to perform at work. On the positive side, flexible working arrangements, increased benefits and new training programs all will increase employee satisfaction moving forward. The focus on re/upskilling employees is particularly crucial to make the insurance workforce future-ready. Remote working and other more flexible hybrid working models will also expand the talent pool for insurers, who have notorious difficulty in attracting and retaining top talent.
I’ve given a lot of examples throughout this blog series, but I want to be clear that they are not an exhaustive list. This series was meant to provide an industry overview, but individual insurance companies did more than the examples I offered.
Since March 2020, insurance companies were pushed off a cliff to fly into the future or crash to the ground. Operations and technology had to transform to enable a pivot to remote and more digital interactions, employees had to jump head-first into new remote working technology and insurers had to support their customers like never before. The transformations that either happened or were accelerated because of COVID-19 will carry into the future, making the industry more modern, more resilient, and, ultimately, more competitive.
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