The National Association of Insurance Commissioners (NAIC) is pointing out that it has been preparing for an outbreak like the new coronavirus pandemic for decades — and that it was around for the 1918 flu pandemic.
The NAIC has posted a new coronavirus outbreak preparedness alert on its website.
The Kansas City, Missouri-based group has also posted a pandemic primer developed by its Center for Insurance Policy and Research.
- The Center for Insurance Policy and Research pandemics primer is available here.
- An article about what the 1918 flu pandemic looked like to U.S. life insurers is available here.
The center has pointed out that well-documented pandemics involving infectious diseases have been occurring for centuries, and that life insurers and regulators are well aware of the need to prepare for pandemic risk.
Insurers need business continuity plans, to figure out how they will operate in the face of serious disruptions, the center says.
Insurers also need a pandemic-resistent investment and business mix, and they may consider using reinsurance, insurance-linked securities and other tools to share extreme mortality risk with others, the center says.
The center provides links to other resources, such as a link to the website of the NAIC’s Life Risk-Based Capital Working Group, and it gives a quick assessment of the effects of the new coronavirus, which causes Covid-19 pneumonia, on insurers in China.
China’s commercial health insurance market is relatively small, and life insurers in China have only about 4% of their business in the region most heavily affected by the new coronavirus outbreak, the center says.