UK's Chartered Insurance Institute Examines Industry Flu Pandemic Role

[Shiloh]

Source: http://www.insurancejournal.com/news/international/2009/03/25/99023.htm

UK's Chartered Insurance Institute Examines Industry Flu Pandemic Role
March 25, 2009

The latest of the UK's Chartered Insurance Institute (CII) Thinkpiece articles - "Pandemics - be prepared" features the work of Trevor Maynard, Emerging Risks Manager at Lloyd's, who highlights the ever present risks posed by pandemics and what the next one could mean for the insurance industry.

The CII Thinkpiece maintains that "a major pandemic will have significant economic consequences and cites the outbreak of SARS in 2002 that caused economic losses of up to $150 billion. The last global pandemic was in 1918 and the report notes historically such events occur every 30 to 50 years; it also cautions against use of the 1918 model as the world has changed much since then - better technology and greater population movement - and warns that a re-run of 1918 could lead to a recession with estimated impacts ranging from 1 percent to 10 percent of global GDP."

In addition the CII report warns that "insurers will be on the front line and must ensure policies are designed to respond to such situations, the report states, emphasizing they should consider new technologies and changing methods of working to cope with stresses that an outbreak would put on business.

"This closely follows evidence given by Professor Lindsey Davies (National Director of Pandemic Influenza Preparedness) to the House of Lords Science and Technology Committee last week during which she focused on the capacity and preparedness of the NHS. Prof Davies said the Government had established effective plans throughout both the NHS and with the private sector to ensure that they would be able to respond to a pandemic."

David Thomson, Director of Corporate Affairs at the CII, commented: "Flu pandemics have great potential to cause extensive human and economic suffering and their impact is becoming increasingly variable. This CII Thinkpiece highlights how critical it is that the insurance industry, together with those responsible for contingency and business continuity, has thought through the risk management and are now ready to face any challenge with robust scenario planning."

A full copy of this CII Thinkpiece can be accessed via this link:
http://www.cii.co.uk/downloaddata/TP_15_Maynard.pdf.

Source: Chartered Insurance Institute - www.cii.co.uk

 

[JJackson]

Re: UK's Chartered Insurance Institute Examines Industry Flu Pandemic Role

As I quite often criticise attempts to communicate the risks of a pandemic to lay audiences I wanted to redress the balance and give credit where due. This is a very well crafted message to its intended audience. It emphasises the variability of flu and the dangers of basing too much on the 20th century flu pandemics, it highlights the JIT systems vunerabilities and is generally well balanced concluding with don't panic but do be prepared.
I do not share his faith in the legally binding nature of the IHR(2005), but that is a very minor quibble. Chief Justice Holt said "It is a vain thing to think there should be a right without a remedy, for want of right and want of remedy are convertibles". If the language seems a little archaic it is because it is from his opinion in Ashby vs. White (1704) but that does not make it any less true.

 

[mixin]

Re: UK's Chartered Insurance Institute Examines Industry Flu Pandemic Role

Some snips from the .pdf:

The breadth of detail (on pandemic preparedness) that is available would make it very difficult for a company executive to argue that their inaction was due to inadequate information and this may have implications for insurance policies offering liability cover.

The Trust for America’s Health research suggests that states in the US will lose up to 8% of their GDP in a major pandemic depending on the mix of business in the region.

It is possible that liability policies will be triggered by a severe pandemic though issues of liability are settled in the courts. Lloyd’s pandemic report considers several hypothetical scenarios, for example whether the organisers of a concert that fail to cancel an event, when their peer companies are acting more cautiously, could be a target for legal action if they are later shown to have helped spread the disease.

The companies that can be shown to lag well behind their peers are most at risk of legal action for failing in their duty of care to their: employees or customers, or for being negligent when safeguarding their shareholders assets.

Many businesses are expecting to make use of “home working” and those that are should fully understand how telecommuting can serve the business and where the weak points are; for example they should evaluate requirements for bandwidth at their gateway and consider buying extra now

After the pandemic is over they should expect a more fluid job market as employees react to how they were treated by employers during the pandemic.