The Big Question: Is UKGI ready to respond effectively to another pandemic event?

Kate Pert, senior complex claims consultant, Marsh

The UK general insurance (UKGI) market is noticeably better prepared for another pandemic than it was in early 2020.

Insurers have acted on lessons learned – policy language is clearer, pandemic exclusions and specific endorsements are widespread, underwriting has tightened and new parametric and hybrid products provide faster, less contested liquidity.

Claims operations are more resilient too – not only able to handle pandemic specific claims, but structured to manage general claims effectively during pandemic conditions.

Well established hybrid working and widespread use of digital tools, remote processing, triage playbooks and predefined settlement routes reduce friction and the risk of protracted disputes.

There is also far greater understanding today around pandemic impacted policies. So, where insurance policies provide cover, the trigger and scope will be established without regulatory intervention and with the benefit of considerable judicial authority on the topic.

That said, pandemic loss is a systemic, highly correlated peril.

Private markets alone cannot fully absorb an event on the scale of Covid-19. Reinsurance and retrocession capacity has been constrained and repriced – many treaties now limit or expressly exclude pandemic aggregation.

Legacy policies with ambiguous wordings continue to pose litigation risk and realistic pandemic pricing can make cover unaffordable for many SMEs, leaving protection gaps.

In practice, the insurance market’s early response to a new pandemic would likely include rapid invocation of existing exclusions where applicable, prompt regulatory engagement and strong demand for parametric products, captives and alternative capital structures.

Sustainable protection for future pandemics will require prearranged public-private mechanisms, such as government backstops or pooled arrangements, alongside continued investment in modelling and client advisory services.

Hazel Johnson, UKGI personal lines claims director, Aviva

The industry is in a stronger position to respond to a future pandemic than it was prior to Covid-19, particularly when it comes to operational resilience and supply chain capability.

One of the biggest learnings from the pandemic was the importance of maintaining customer service, even when disruption is widespread and prolonged.

This is particularly important in claims management, where customers rely on insurers to support them when they need it most.

Our investment in claims capabilities, alongside enhanced supply chain resilience, has strengthened our readiness for large scale events.

For example, Aviva’s wholly owned repair network, Solus, gives us greater control across the supply chain, improving both the consistency and resilience of our claims service and allowing us to control costs.

Our May 2026 acquisition of DisasterCare Group builds on this approach, extending in-house capabilities into property claims.

Paired with our strong track record in dealing with surge events, these investments put us in a stronger position to adapt quickly to pressures on our supply chain or labour markets, such as the difficulties the insurance industry experienced with repair parts and logistics during 2020’s pandemic.

The Covid-19 pandemic and subsequent supply chain pressures highlighted the importance of prioritising flexibility and resilience, creating a playbook for dealing with global events.

Aviva is well positioned for any future pandemics or geopolitical events because of stronger operational resilience, allowing us to focus on maintaining service to our customers, brokers, colleagues and partners.

Louise Butcher, executive director of forensic accounting, McLarens

The insurance industry is arguably better prepared today than it was prior to the Covid-19 pandemic.

Covid-19 exposed a fundamental reality – traditional business interruption (BI) policies were primarily built to respond to physical property damage, with various damage and non-damage extensions added over time.

However, many of those extensions had never been tested with an event of Covid’s scale and global impact.

While BI extensions have in the past responded to isolated events such as terrorist attacks, riots or – for example – the Holborn power outage in 2015, none of these situations carried the same breadth, duration or interconnected consequences compared to 2020’s pandemic.

The disputes and coverage challenges that followed Covid-19 highlighted how quickly the risk landscape of the modern world was evolving and, in many respects, how policy wordings were struggling to keep pace.

A future event may emerge in a very different form, but with similarly far-reaching consequences.

Whether driven by cyber risk, a major data centre failure, geopolitical disruption affecting global supply chains or fuel shortages linked to the Strait of Hormuz, the same core questions will arise – what constitutes causation, when are non-damage BI extensions triggered and to what extent does cover actually respond?

The prior pandemic also brought renewed focus to the role of government support and intervention in the context of BI claims and how such measures should be treated under policy coverage – a complex issue given the differing court rulings worldwide.

It is crucial to address identified issues proactively, to avoid revisiting the same uncertainties, reinterpreting the same policy wordings and asking the same fundamental questions all over again.

Duncan Pritchard, managing director, Commercial Express

The general insurance industry is better prepared operationally than it was in 2020, but I do not think anyone should assume the market is fully pandemic ready.

One of the clearest lessons from the Covid-19 pandemic was that responsiveness matters just as much as capacity.

During the pandemic, brokers and their clients needed quick decisions, clear communication and practical support.

In many cases, MGAs were able to react faster than insurers because our model is inherently more agile and closer to the broker relationship.

Covid-19 highlighted where large organisations struggled operationally, whether that was service disruption, delays in decision-making or simply the flexibility to adapt quickly enough to overnight changes in customer needs.

It also demonstrated the value of businesses that could make underwriting and trading decisions without layers of process slowing things down.

In the main, the insurance industry will no doubt have learned these lessons, investing in digital capability, remote trading infrastructure and operational resilience. That is a positive step.

But preparedness is not just about technology – it is about having the right culture, authority and accountability in place to respond quickly when conditions change unexpectedly.

From an MGA perspective, one of the biggest lessons from the last pandemic was the importance of listening closely to brokers and adapting products and service around real-world trading conditions.

The businesses that maintained strong relationships and communicated consistently during the Covid-19 years generally came out of the period in a stronger position.

Jo Lloyd, customer and propositions director, Axa Insurance UK

Insurers are accustomed to meeting the evolving needs of customers and adapting at pace as the insurance landscape rapidly shifts.

In recent years, we have demonstrated resilience, facing into new and emerging risks as well as meeting challenges that stemmed from the Covid-19 pandemic.

This has required ongoing review and re-evaluation to make essential changes in how we approach all business areas.

With unexpected events and instability increasing across the globe, alongside the disruption brought about by emerging technology, the role of insurance has evolved and customer expectations have changed.

Supporting vulnerable customers has become an increasing priority and, post-pandemic, we have focused even more on developing products and services that support those that need additional help.

Furthermore, customers now demand more convenience and flexibility from insurance propositions, together with more options for how they interact with us. 

We are using artificial intelligence (AI) and emerging technology to explore ways to improve customer service, product development, fraud detection and risk assessment, to name a few key areas.

While the results so far have been positive, human interaction and empathy remain crucial to building trust with customers and for Axa Insurance UK, this remains a priority.

The Covid-19 pandemic also prompted many people to place a greater focus on health and wellbeing, accelerating their desire to find balance in their lives.

Supporting wellbeing has long been a priority for Axa and during the pandemic, we ramped up our activity in this area. We remain committed to supporting the health and wellbeing of our colleagues, recognising that when our people feel valued and cared for, they are better able to deliver for our customers and partners.