Atlas Magazine February 2022

Covid-19, an endless world

Worn out by a year of pandemic, insurers kick started 2021 in high spirits. Indeed, the first vaccines, unanimously awaited, created hope for a quick return to normal life and a vigorous recovery of business.
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With the Covid-19 virus now under control, it was time for the industry to build a new insurance model based on public-private collaboration and a better handling of new systemic risks.

In this context, digital transformation, another recurring theme at the beginning of 2021, took on an absolute urgency.

Unfortunately, insurers' hopes were cut short. A second wave of Covid-19 has swept across the globe, initiating a most stressful "stop and go" cycle. At the same time, in mid-2021, cybercrime escalated, and the elements of nature have been unleashed.

As for the market, the past year has recorded the heaviest natural catastrophe balance sheet in the history of insurance after 2017. The profession has reported 120 billion USD of losses in 2021 against 82 billion USD in 2020 and 57 billion USD in 2019. The most outstanding events pertain to hurricane Ida (USA-Canada), winter storm Uri (USA), floods in Europe, fires in California, Canada and around the Mediterranean.

Along with the pandemic and natural disasters, cybercrime was a major concern for insurers in 2021. The level of cyberattacks has never been higher, as telecommuting has increased the risk of hacking. This increased risk exposure has led to higher cyber rates and lower capacity due to insurers' low appetite for the risk.

As a matter of fact, 2021 proved to be as bleak as 2020. Bearing and living with the virus and mastering new systemic risks is the only way out for insurers in 2022.

Atlas Magazine N°188 February 2022

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